By Zhang Yansheng Source:Global Times
The phase one trade deal between China and the US is a mutually beneficial agreement.
With the presidential election kicking off this year, US President Donald Trump wants a deal that wins him more votes in agricultural, energy, industry and services-sector states.
China, on the other hand, is set to achieve a moderately prosperous society this year, which requires a stable and predictable external environment.
The deal will stabilize global expectations. The two parties in the trade war, which jointly contribute 60 percent of global growth, are too crucial to the world. The world needs a truce.
China should bind the US with the agreement. The US may play tricks on the pace of tariff roll-backs, first, less important tariff items – then, more significant ones. But the country must abide by the agreement.
The implementation of the phase one trade agreement should not be just one-way.
If China agrees to specific purchases including semiconductor in the phase one trade deal, it will involve companies like Huawei – whether the US allows suppliers to sell devices to Huawei? If the US does not, how could the specific purchases be reached?
Purchases of US products must follow the WTO’s principles and market economy principles. China cannot force the US to sell. If the US refuses to sell, and China fails to buy enough to meet the target figure, who should we blame?
The author is chief research fellow with the China Center for International Economic Exchanges. [email protected]