China Is Not Even Close To Meeting Phase One Trade Deal Agreements
Blame it on the pandemic. Or maybe (depending on whom you ask) it’s just China being China. But the “super great” phase one trade deal that President Trump got done last year is nowhere near the commitments China made in terms of imports.
Not for manufactured goods. Not for agriculture commodities. And not for Energy exports, either. China, as of July 2020, is not even half way there on any of these three items.
China imports of manufactured goods was supposed to come in at around $75 billion. It’s around $25 billion as of July. Agriculture imports were supposed to reach around $35 billion. That’s around $9 billion as of July, though like oil and gas exports, this has a lot to do with declining commodity prices for things like soybeans and crude oil. Energy exports to China were targeted for around $25 billion and they are just around $5 billion as of July.
In the first seven months of the year, the value of energy exports only reached 13.6% of the target.
With roughly five months left in the year, even if China doubled it, they wouldn’t make it.
Lori Ann LaRocco pointed this out yesterday. The author of “Trade War: Containers Don’t Lie”, published last year, says that China commitments don’t equate to real numbers. “Exports do not count until they are on a ship traveling to its destination. Commitments are a commitment, not an official transaction,” LaRocco says.
Next week, the U.S. Census Bureau will release its trade data for the month of August. The deficit with China is seen being a record breaker of close to $80 billion as many companies stopped importing March through May and started picking up again slowly in June due to factory closures in the U.S. as well as in China.