Daily Management Review

Peterson Institute: China fulfilled just 58% of US-China trade deal


The U.S.-China trade deal, negotiated at length in January 2020, was only partially fulfilled by the PRC at 58% amid the pandemic, but China did increase its purchases of American goods, according to the Peterson Institute for International Economics (PIIE). In total, PRC imports amounted to about $100 billion against a plan of $173.1 billion, and by the end of the year the implementation rate had increased: at the end of January-July it was only 50%.

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Recall that the trade deal between the United States and China entered into force on February 14. Under its terms, China pledged in 2020-2021 to cumulatively increase the purchase of American goods by about $ 200 billion to the level of 2017 in exchange for the rejection of Washington's last round of duty increases and cut in half (to 7.5%) of the tariff on Chinese imports at $ 112 billion. This included an increase of $63.9bn by the end of 2020. The list of goods in the agreement covers 2017 imports of $109.2bn (71% of China's imports from the US, $154.9bn).

Actual purchases of agricultural products were $23.5 billion versus $36.6 billion as planned (64% of the target, with 2017 shipments at $24.1 billion), manufactured goods at $66.7 billion versus $111.2 billion (60%, with 2017 at $78.3 billion), energy products at $9.8 billion versus $25.3 billion (39%, with 2017 at $6.8 billion), PIIE calculations show. For other goods not covered by the deal, China's imports amounted to $35bn, which is 23% less than in 2017 ($45.6bn).

As a result, China's trade turnover with the U.S. increased by 8.3% to $586.73 billion. Chinese exports, in turn, increased by 7.9% to $451.8 billion, and U.S. shipments to China increased by 9.8% to $134.9 billion. China's shipments were not the only ones to increase in the US: the year-end total was up 3.6% year-on-year to a record $2.59 trillion, while China's imports fell 1.1% to $2.06 trillion, Chinese customs data showed. China's 2020 trade balance increased to $535bn (the highest since 2015). As a result, despite US duties and restrictions on the supply of some companies, China increased its share in global trade in 2020 - it was about 13.4% previously, in 2019.

source: piie.com