US-China Trade Agreement Hits A Roadblock On-Farm Purchases

The trade war between China and the US was looking to come to a simmering point, but now the new issue that has cropped up is that of farm purchases. China had agreed to purchase up to $50 billion of soybeans, pork and other agricultural products from the U.S. annually. But China is somehow unsure about putting a numbered commitment down on an agreement.

Something which is becoming symptomatic of dealing with the US, China like Iran doesn’t wish to an imbalanced deal that weighs more on the other side. Beijing would prefer a flexible deal, in case of tension escalated with a rather immature trade partner like the US. Both sides are also at odds over whether and by how much the U.S. would agree to lift tariffs on Chinese imports, Beijing’s core demand is linked to its offers on other issues as well.

Another aspect worrying China is the way the U.S. is demanding a strong enforcement mechanism for the deal and curbs on the forced transfer of technology for companies seeking to do business in China.  Beijing can see that everything seems to be in favour of the US, leaving the Chinese side vulnerable to a huge hit, if things don’t stabilize.

Earlier this week, the Commerce Ministry spokesman had said that the U.S. had agreed to eliminate some existing tariffs as a part of the first phase of what could be a multipart deal. However, this news seemed to have had sparks flying in the American skies, with trade hawks in Washington gunning down Trump. Mr. Trump had then retracted this statement and called it a Chinese bluff.

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