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Sun Jan 19, 2020, 09:01 PM

U.S.-China Trade Pact, Meant to Heal Rifts, Could Make Them Worse

BEIJING — President Trump and China say their new trade pact is just the beginning of a fresh relationship between the world’s two biggest economies. Future deals will make China a better trading partner, the White House says. Beijing claims to foresee an end to American tariffs and the punishing trade war.

They are probably both wrong.

Wednesday’s partial trade pact, portrayed by both sides as a temporary truce, may be the lasting legacy of more than two years of economic conflict. It could ensure that American purchases of Chinese goods, already tumbling, will fall even more. And rather than heal the relationship, it could drive the two economic titans further apart, transforming how global business is done.

The deal signed on Wednesday by Mr. Trump and Vice Premier Liu He, China’s top trade negotiator, cuts a few of the American tariffs imposed over the past two years on Chinese-made goods and forestalls even more. It commits China to buying $200 billion more in American grain, pork, jetliners, industrial equipment and other goods over two years. It requires China to open further its financial markets and protect American technology and brands, while setting up a forum for the two sides to argue about their differences.

What it does not do is tackle the root causes of the trade war. The deal leaves untouched Beijing’s subsidies for homegrown industries and its firm control over crucial levers of its hard-charging economy. The deal also keeps in place most of Mr. Trump’s tariffs on $360 billion worth of Chinese goods, a much heavier tax than Americans pay for products from practically anywhere else.


As I've stated before, Trump was so desperate for a win he'd agree to anything.

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