President Trump has just signed the Phase 1 of a new China trade deal. The complexity of the American and Chinese relationship makes achieving complete trade deals very difficult. But Trump’s new China trade deal makes a monumental first step toward free and fair trade that addresses problems in key US farming and industry sectors. In the short term, the deal helps sectors like these that bore the heaviest burden in this bilateral trade war. But in the long term, Chinese will open their markets to compete more fairly with US manufacturers.
Highlights of the new China trade deal with the US
Chalk up this trade deal is a huge win for all Americans. It’s a particular boon for American workers, taxpayers, businesspeople, consumers and investors. Details of the new China trade deal include the following.
- China has agreed to continue to eliminate tariffs on agricultural products.
They pledge to purchase as much as $50 billion of American farm produce over the next two years. This is great news for America’s farmers. They have struggled since China retaliated against Trump’s tariffs by placing tariffs on farm products even as a phenomenally wet 2019 spring and summer season worked against the volume of their production. The trade deal assures our farmers a strong steady demand for their products coming from China in 2020 and beyond.
2. China also agreed to purchase another $150 billion of US manufacturing goods.
This volume of new orders promises to increase production at many US factories. In turn, it will also help increase the demand for factory workers. Moreover, the newly re-opened Chinese markets for American goods will remain open into the future.
3. China has also agreed to stop manipulating their currency.
Analysts view this as an unheard-of victory for America’s business and manufacturing sectors. Historically, China routinely devalued its currency. This, in turn, made their goods cheaper for us to buy while making our manufactured goods too costly for the Chinese to buy. That’s why so many American companies started began moving their manufacturing operations to China. And that, in turn, is why we currently hold such a negative balance…