EXCLUSIVE US calls for “concrete action” from China to meet Phase 1 purchase commitments

Chinese and U.S. flags flutter in front of a company building in Shanghai, China November 16, 2021. REUTERS/Aly Song

WASHINGTON, Feb 7 (Reuters) – US officials on Monday called for “concrete action” from China to live up to its pledge to buy an additional $200 billion in US goods and services in 2020 and 2021 to comply with the “Phase 1” trade deal signed by China former President Donald Trump.

The officials said Washington is losing patience with Beijing, which has shown “no real signs” in recent months that it will close the gap in its two-year purchase commitments, which expire at the end of 2021.

The comments come a day before the US government is scheduled to release full-year trade data that analysts expect will reveal a significant gap in China’s promise to increase purchases of US agricultural and industrial goods, energy and services.

By November, China had only met about 60% of the target, according to trade data compiled by Chad Bown, senior fellow at the Peterson Institute for International Economics.

US President Joe Biden said the trade deal does not address core issues with China’s state-run economy, but US officials have urged Beijing to honor the signed deal.

“Because we inherited this deal, we have tasked the (People’s Republic of China) with missing purchase commitments, both to fight for US farmers, ranchers and manufacturers and to allow China to honor its commitments.” But our patience is running out,” one of the officers said.

China continued to engage with US officials on the issue, but Washington is looking for “concrete action,” not “talking for the sake of talk,” the official added.

US officials said they would continue to urge China to show “serious intentions” to reach an agreement on their purchase commitments, but acknowledged the deal’s framework gave them little leverage over enforcing the purchase commitments.

Regardless of how the negotiations end, US officials said they would remain focused on the core issues facing China’s state-run economy while working to boost US competitiveness through market diversification and cooperation with allies and partners.

US Deputy Trade Representative Sarah Bianchi told a trade conference on Tuesday that China has failed to meet its purchase commitments under the deal and that talks between Washington and Beijing have been “very difficult”.

The deal, signed by Trump in January 2020, eased a nearly three-year trade war between the world’s two largest economies, but left hundreds of billions of dollars in tariffs on imports on both sides of the Pacific.

A spokesman for the Chinese embassy in Washington said last week Beijing was working to implement the Phase 1 deal “despite the impact of COVID-19, the global recession and supply chain disruption.”

Reporting by Andrea Shalal and David Lawder; Edited by Simon Cameron Moore

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