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“Look, I’m having a very difficult time with China,” Trump said in an interview on Fox & Friends. “I made a great trade deal months before all of this happened. And it was starting, you know, a month ago and it starts to kick in and it starts producing and then this happens and somehow nullifies a lot.”
Trump’s statements contrasted with statements by Chinese and American officials earlier in the day that followed a phone call between the country’s top trade negotiators, Chinese Vice Premier Liu He, and United States Trade Representative Robert Lighthizer and Secretary Treasury Steven Mnuchin. They pledged to create favorable conditions for the implementation of the bilateral trade agreement and cooperate in the economy and public health, according to a statement from the Chinese Ministry of Commerce.
But Trump reflected on somehow punishing China for the coronavirus outbreak, which has so far killed at least 75,000 Americans. This week he was asked if he could impose tariffs on China due to the virus, which he has suggested is the result of an investigation the country was conducting in a laboratory in Wuhan, China.
“No one else made a trade deal with China, because they couldn’t do it, because China wouldn’t, because China had a one-way street to defraud the United States.” We were losing $ 500 billion a year, five hundred, “Trump said on Friday.” And that’s why I’m so torn, I haven’t decided yet if you want to know the truth. “
The USTR take
A statement from Lighthizer’s office after the phone call was more positive.
“Both sides agreed that good progress is being made in creating the necessary government infrastructure to make the deal a success,” said the USTR. “Despite the current global health emergency, both countries hope to fully meet their obligations under the agreement in a timely manner,” the statement added.
Relations have deteriorated between countries due to the coronavirus outbreak. Chinese authorities have denied accusations by the United States that the pandemic is the result of work done in the Wuhan laboratory, and the Chinese Foreign Ministry has accused some US officials of trying to “shift their own responsibility for mismanagement of the epidemic to others. “
The phone call was the first time Liu and Lighthizer officially spoke about the deal since it was signed in January, just before the coronavirus pandemic hit the world’s two largest economies and overturned global supply chains. The agreement required Liu and Lighthizer to speak every six months.
Favored onshoring
Speaking on Bloomberg Television, the Director of the National Economic Council, Larry Kudlow, said that while the trade relationship between the United States and China is on the way, Trump is “very interested” in bringing more business to the United States through incentives to the companies.
“Too much emphasis on overseas supply chains is not secure, it is not reliable, it is not good business practice,” he said in an interview with Jonathan Ferro.
S&P 500 futures hit their session highs after reports that China and the United States had a phone call in trade. Japan posted gains of around 1.5%, the biggest moves, while stocks also rose in Hong Kong, Shanghai, Seoul and Sydney. The yuan pushed higher.
Trump told reporters at the White House on Wednesday that he could report in the next two weeks whether he is happy with the progress of the trade deal.
Chinese purchases of US exports USA So far they have been below the pace needed to reach the goal of the $ 76.7 billion increase in the first year, as imports of US products decreased by 5.9% in the first four months of 2020 from the coronavirus outbreak. . As imports in 2019 were smaller than in 2017, the pressure to catch up is mounting.
Uncertainty and the weaker economy caused by the coronavirus outbreak could affect China’s ability to meet those goals, including through lower domestic demand, clogged logistics and supply chains, and a reduced ability of the United States to supply goods. and services.
Some purchases are underway, with China buying six loads of soybeans on Thursday and more than 600,000 tons of corn recently.
China has made progress on other sections of the trade agreement, lifting restrictions on a variety of agricultural imports from the US. The US, including beef and poultry, removing foreign ownership limits in the financial sector and issuing a guideline on intellectual property protection.
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