China’s Proposal to Restore 2020 Trade Deal with U.S. Reported by WSJ

Image Credit: Reuters

China’s initial response to the tariffs imposed by U.S. President Donald Trump will focus on reviving the “Phase 1” trade agreement signed in 2020 during Trump’s first term, according to a report by the Wall Street Journal, citing sources.

China’s proposal also includes pledging not to devalue the yuan, offering to increase investments in the U.S., and committing to reduce exports of fentanyl precursors, the report says.

In response to Trump’s new tariffs—25% on Mexican and most Canadian imports, and 10% on Chinese goods related to fentanyl and illegal immigration—China condemned the move but left open the possibility for talks to prevent further escalation. Meanwhile, Canada retaliated with 25% tariffs on $155 billion worth of U.S. goods.

The 2020 Phase 1 deal between the U.S. and China helped end a two-year trade war, requiring China to boost its purchases of U.S. goods by $200 billion over two years. However, Beijing fell short of meeting these targets, largely due to the disruptions caused by the COVID-19 pandemic.

Additionally, the report mentions that Beijing plans to handle the issue of TikTok as a “commercial matter,” allowing ByteDance, the Chinese owner of the app, to negotiate with potential U.S. buyers. Trump has previously expressed interest in a bidding war for TikTok, including discussions with Microsoft, for a potential purchase.

The U.S. Department of Commerce did not respond to the Wall Street Journal’s request for comment, and China’s commerce ministry was unavailable for comment due to the Lunar New Year holiday.

 

 

 

Paraphrasing text from "Reuters" all rights reserved by the original author.