Sixty lawmakers in the House of Representatives are urging President Joe Biden to take action on Beijing’s failure to fulfill its commitments under “Phase I” of a trade agreement with the United States.
Trade data compiled by Peterson Institute for International Economics senior fellow Chad Bown shows that China has only achieved around 60% of the goal as of November.
The lawmakers are particularly concerned that the Chinese regime is not buying enough U.S. agricultural products under the agreement.
Their letter to Biden on Feb. 15 on the newhouse.gov website said, “More than two years ago, on Jan. 15, 2020, the United States and China signed the two-year Phase One trade deal which, among other things, required China to make structural reforms to its trade regime and import $73.9 billion of U.S. agricultural products. As you know, China failed to meet their commitment to the U.S. to purchase additional agricultural goods by nearly $16 billion in 2020 and 2021 combined.”
As Reuters reported on Feb. 7, the U.S. officials called for the Chinese regime to purchase an additional $200 billion in U.S. goods and services between 2020 and 2021 under the “Phase I” trade agreement signed by the U.S. and China in January 2020.
U.S. President Joe Biden said that the trade agreement does not solve the fundamental issue with China’s state-led economy. Nevertheless, U.S. officials have encouraged Beijing to fulfill the terms as agreed.
One of the officials said, “Because we inherited this deal, we engaged the (People’s Republic of China) on its purchase commitment shortfalls, both to fight for U.S. farmers, ranchers and manufacturers and give China the opportunity to follow through on its commitments. But our patience is wearing thin.”
The New York Times also reported on Feb. 8 that the specific targets for China are to purchase at least $227.9 billion worth of U.S. goods in 2020 and at least $274.5 billion worth of goods in 2021, which should total $502.4 billion over the two years.
However, the Peterson Institute for International Economics (PIIE) released a report that the Chinese ended up buying only 57 percent of the promised U.S. goods, worth a total of $288.8 billion.
In January 2022, U.S. Agriculture Secretary Tom Vilsack spoke at the American Farm Bureau Federation (AFBF) Convention about the $16 billion shortfalls in China’s trade.
“And I think it starts with China. And we all know and appreciate the fact that we have a Phase One trade agreement with China,” Vilsack told AFBF members. “And during that period of time, we saw sales to China increase over what they were during the trade war. But here’s the deal with Chinese friends, they’re about $16 billion light over what they committed to purchase. And that’s why Ambassador Tai, our U.S. Trade Representative, continues to converse with China about the necessity of living up totally and completely to the Phase One trade agreement, making up that $16 billion deficit over the course of the next several years.”