Biden admin imposing new trade rules on China to force compliance with Trump-era deal

The Biden administration is preparing to impose new trade regulations on China after Beijing has failed to follow through on a trade commitment made with the Trump administration in a deal set before the COVID-19 pandemic.

Fox Business reported Monday that administration officials are citing “unfilled commitments” on the part of China regarding Trump’s Phase One Trade Agreement struck in the fall of 2019 after both countries engaged in a tit-for-tat trade war of sorts through the imposition of hundreds of billions of dollars worth of tariffs.

The Biden administration will employ “all available tools” to enforce provisions of the agreement, senior officials told the network, without specifying what enforcement tools will be used to ensure Chinese compliance.

U.S. Trade Representative Katherine Tai will announce Monday that Beijing has failed to comply with the agreement; China pledged to purchase $200 billion worth of U.S. goods over a two-year period, but so far has come short of those expectations, officials said.

“Part of the new plan will involve the U.S. restarting a targeted tariff exclusion process, according to senior administration officials,” Fox Business Network reported. “The U.S. will also be engaging with allies in hopes of promoting fair, competitive, international trading.”

The new measures will be announced by Tai during a speech Monday in Washington in which she will review U.S. trade policy with the Asian economic giant, CNBC reported, marking the final three months of the Phase One deal.

According to Chad Bown, a senior fellow at the Peterson Institute for International Economics in Washington, China has only purchased about 62 percent of the agreed-upon targets under the deal, Reuters added, citing data on U.S. exports.

The U.S. actions come amid rising tensions between both economic powers following restrictions placed on Chinese companies by the Trump and Biden administrations that block Beijing’s access to sensitive American technologies.

As for Tai, she has maintained that the U.S. faces “very large challenges” regarding its trade relationship with China that will require broad attention and engagement across the current administration in order to effectively deal with.

In addition, she has also asked lawmakers for additional trade regulations and statutes aimed at countering large financial subsidies China provides to its high-tech sectors.

In an interview with Politico, Tai said that Trump’s trade tariffs “had the effect of getting a lot of people’s attention,” including American executives and Chinese government officials.

“In that sense, I would say that the 301 tariffs are a tool for creating the kind of effective policies, and [are] something for us to build on and to use in terms of defending to the hilt the interests of the American economy, the American worker and American businesses and our farmers, too,” she said. “I think it’s going to be important to review China’s performance with China, and that’s going to be the critical first step in my mind.”

She went on to say her office is completing a “top-to-bottom” review of U.S. trade policy towards China which began after she was confirmed, adding that there are “a lot of lessons” to take away from previous failed attempts to get Beijing to change its trade practices.

“I think we’ve always had our intentions in the right place in terms of engagement on the one hand, enforcement on the other hand,” she told the outlet. “But over time, we have to gauge how effective we have been.”

Jon Dougherty


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