It appears that the US China 100 day plan is falling behind schedule. During Chinese President Xi Jinping April visit to Donald Trump in Florida, both agreed to a 100-day plan for trade talks. These talks focused on boosting US exports to China and a reduction of the US trade deficit with China. Some deals have been made since the April meeting, though more needs to be done. The 100-day plan is not delivering what was hoped for.
The 100-day plan expires Sunday, July 16. So expiry date is past. What has been agreed and what has been achieved to date? China’s market has been reopened to US beef 14 years after it was closed in 2003. This was due to mad cow disease in American cattle. US ranchers can now export beef to China a market worth around $2.6 billion in 2016.
Chinese consumers can buy American beef in Chinese stores. There is a big demand for US beef in China, although not so much in the US for Chinese cooked chicken. This was also part of the 100-day plan – one that benefitted the US more than China.
In return, China has pledged to open its borders to US liquefied natural gas. Also, China is permitting US companies to have access to certain areas of the Chinese financial services industry. China still has to be able to export Chinese-reared and cooked chicken into the USA. There are other comestible issues such as biotech crops that have yet to be resolved.
However, the big issue for the US is not beef and chicken, but steel and aluminum. The US has demanded that China cut its excess production of these metals. Donald Trump is afraid of excess Chinese production of aluminum and steel flooding the US market and driving down prices should it be given unrestricted access.
The US also complains about not receiving sufficient access to the Chinese services market. From China’s aspect, there are the US national security restrictions on the export of hi-tech products to China to be discussed.
Another big issue President Trump has with China is North Korea. He expects China to exert a degree of control over North Korea, rather than to act as an ally. Trump pointed out on Twitter recently that trade between these two Asian countries has increased by 40% in the first quarter of 2017.
He expressed a degree of skepticism regarding China’s desire to rein in North Korea. This is particularly after the July 4th missile test – the date appears just too coincidental a snub to the USA! The shadow of North Korea will always be there, but China and the US seem about to agree on another 100-day plan!
The so-called “US-China Comprehensive Economic Dialogue” is to be discussed during US-China bilateral talks over the coming week. No doubt another batch of agreements will come out of it, but what about those not yet achieved? We shall await developments on how any new plans reflect the failure of the old. F or now, the US China 100-day Plan is only partially complete.