Biden will not immediately end phase one China trade deal: NYT

Deal signed in January requires China to increase purchases of US products and services by at least $200bn over 2020 and 2021.

Biden says the US needs to regain leverage to use in trade negotiations with China [File: Mike Theiler/Reuters]

US President-elect Joe Biden says he will not immediately end the phase one trade agreement with China or roll back punitive tariffs on Chinese goods imposed by President Donald Trump, the New York Times reported on Wednesday.

In an interview with a Times columnist, Biden said that the United States needed to regain leverage to use in negotiations with China.

“I’m not going to make any immediate moves, and the same applies to the tariffs,” Biden said. “I’m not going to prejudice my options.”

“In my view, we don’t have [leverage] yet,” he added.

‘Fight like hell’

The US needs to develop a bipartisan consensus and increase government-led investments in research and development, infrastructure and education to better compete with China, according to the president-elect.

“I want to make sure we’re going to fight like hell by investing in America first,” Biden said.

Under the phase one deal signed in January, China agreed to increase purchases of US products and services by at least $200bn over 2020 and 2021.

The deal also leaves in place 25 percent tariffs on a $250bn array of Chinese industrial goods and components used by US manufacturers, and China’s retaliatory tariffs on more than $100bn in US goods.

Biden’s team will pursue policies targeted at China’s “abusive practices,” including “stealing intellectual property, dumping products, illegal subsidies to corporations” and forcing “tech transfers” from US companies to their Chinese counterparts, according to the interview.

The deal reached under Trump was seen as a significant breakthrough after a two-year-long trade dispute between the world’s two largest economies.

It set ambitious targets for China to sharply boost purchases of US farm and manufactured goods.

But ties quickly soured following the coronavirus pandemic and China’s imposition of a new national security law in Hong Kong.

Both sides traded threats and sanctions on individuals and businesses, such as Chinese video sharing platform TikTok.

Official data also suggests China’s imports of US farm and manufactured goods, energy and services are far behind the pace needed to meet a first-year target increase of $77bn above 2017 purchases.

China’s purchases have, however, increased in recent months as its economy recovers from this year’s coronavirus lockdown.

Source: Reuters