The trade war between China and the United States has weighed on the economies of both countries. Tensions appear to have led to a slowdown in U.S. manufacturing. Chinese exports to the United States have collapsed. WASHINGTON (AP) – The United States and China reached a trade agreement Wednesday that eases tensions between the world`s two largest economies, offers massive export opportunities for U.S. farms and factories, and promises to do more to protect U.S. trade secrets. The agreement also contains obligations, at least on paper, to stop the forced transfer of U.S. technology to Chinese competitors.
Companies have long complained about having to issue valuable business secrets and technologies to do business in China. China has pledged not to require such transfers, even if companies apply for certain government licenses or authorizations. The government acknowledges that the agreement has not resolved some U.S. complaints, particularly the way the Chinese government subsidizes its businesses. That was the concern expressed when Trump sparked a trade war in July 2018 by imposing tariffs on Chinese imports. The agreement contains some victories for President Trump, but implementing and implementing the agreement could be difficult. “Today, we are taking an important step we have never taken with China toward a future of fair and reciprocal trade with China,” Trump said at a White House ceremony. “Together, we are correcting the injustices of the past.” Trump`s agreement is intended to facilitate the identification and punishment of theft and counterfeiting of intellectual property. For example, several provisions relating to the protection of confidential information are added, considered trade secrets and which, according to AMERICAN companies, are not well protected by Chinese law.
These safeguards also include “electronic intrusions,” a reference to hacking computer systems. Mr. Trump said his deal was a blessing for farmers, who are among the hardest hit by the trade war. The agreement contains substantial commitments from China on the purchase of agricultural products, aircraft, pharmaceuticals, oil and gas. The agreement provides the United States with certain benefits in financial services, including electronic payments, securities, fund management and insurance, but many of these changes were already underway. Already in 2017, in its attempt to ease tensions with the Trump administration, China had tried to give foreign companies greater supremacy in its financial sector, and U.S. banks and other companies held majority stakes in Chinese companies. The deal leaves tariffs on about $360 billion in Chinese imports, with the government`s leverage hoping to generate concessions in the future. The administration has indicated that it will address some of these changes in Phase 2 of the negotiations and will partially maintain tariffs to maintain leverage for the next roundtable. Trump said he would remove all tariffs if the two sides reach an agreement in the next phase.
REALIZING that it is in the interests of both countries for trade to develop and for international standards to be adhered to in order to promote market-based outcomes. Ms. Vetter said that the agreement was surprisingly reciprocal in this area and that he had granted concessions that China wants to deal with more securely to the United States. Beijing is also relaxing licensing, inspection and registration rules, which the United States has seen as trade barriers. The amendments cover products such as meat, poultry, pet food, seafood, feed, baby food, dairy products and biotechnology. If these discussions are not able to resolve the dispute, other tariffs will come into effect. In such a scenario, the other party promises not to impose its own tariffs.