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. The mayors of Davenport and Saint-Gabriel, who represented cities heavily dependent on agriculture, expressed their fear that the trade war would have on their cities. [286] Economists at the financial firm Morgan Stanley expressed concern about the end of the trade war, but warned in June 2019 that this could lead to a recession. [321] U.S. tariffs of 25% on previously imported $250 billion worth of Chinese goods will remain unchanged immediately. These could be withdrawn as part of a phase 2 trade negotiation, U.S.
Treasury Secretary Steven Mnuchin said Wednesday. The trade war indirectly led to the bankruptcy of some companies. One of them, Taiwanese LCD panel manufacturer Chunghwa Picture Tubes (CPT), went bankrupt following an oversupply of panels and then a fall in prices, supported by vulnerability to trade war (caused by over-expansion in China), a slowing Taiwanese and global economy and a slowdown in the electronics sector. [253] [256] For Mr. Trump and other supporters, the approach to past trade agreements, which has allowed the outsourcing of businesses and led to the loss of jobs and industries. Critics say this is the kind of controlled trade that the United States has long criticized, particularly with regard to China and its control over its economy. 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.
James Andrew Lewis of the Center for Strategic and International Studies said the U.S. china needs a commitment to respect international trade rules and standards and to extend mutual treatment to U.S. companies in China. [316] As of September 2020, China had purchased only 53 per cent of what was expected at this time of year (Chart 1, Panel a).3 Imports of all covered products were only $65.9 billion compared to a target of $124.9 billion. Up to three-quarters of 2020, China had bought only more than a third of what it had promised in the Trump deal it would buy this year. (The full-year purchase target is $173.1 billion.) Chinese imports from the United States failed to catch up with their pre-trade level and were 16% lower than the same date in 2017. Tariffs imposed by the United States and China on imports from each other have decimated bilateral trade in 2018 and 2019. The Trump administration negotiated the legal text of the Phase 1 agreement to force China to buy an additional $200 billion of U.S. goods and services in addition to 2017 (not 2019) if bilateral trade was more robust.2 The legal evaluation of the agreement therefore requires a comparison of 2020 with 2017. Among the most important issues discussed in the negotiations with China was the question of how to enforce an agreement. After observing the agreements with China that they did not keep their promises, many U.S. experts and leaders were skeptical that the Trump administration could lead China to meet its commitments.
