1 / 10 Trump's heralded trade deal with China rests on a $200 bn assumption: China will increase purchases of US exports by $200 bn over 2020-21. But a look at The agreement's LEGAL text + DATA + ECONOMICS ___ = this is highly UNLIKELY. My latest
Fortunately for Trump, the legal terms of the US-China deal are structured so that evidence of shortfalls in those $200 billion of Chinese purchase pledges won’t be clear until after the presidential election in November 2020.
Besides managed trade, there are 5 other reasons to be skeptical of the phase one deal with China: 1⃣ Uncertainty over phase 2 2⃣ Restrictive export controls 3⃣ China's growth slowdown 4⃣ Already-changed supply chains 5⃣ Reduced Chinese demand for US goods
China has, in effect, pledged to increase its purchases of certain American agricultural products by 60%, and manufactured products by 65%, by the end of this year compared with levels in 2017. This must happen regardless of economic conditions in China.
Today, Trump’s Phase One agreement goes into effect. But even without the devastating impact of COVID-19, China’s $200 billion of purchase commitments were unrealistic. Why an unrealistic deal is a very bad trade deal.
Beyond the platitudes and conjecture about the US-China trade truce, digs into the data and finds disturbing implications for managed trade
Markets are optimistic on the phase one trade deal. is not. Detailed analysis from the team here:
.'s calculations: ____________________ ┃China phase 1 ┃ ┃deal purchasing┃ ┃commitments | ┃are unrealistic | └━━━━━━━┘ 7 ┃ 8┃ 9┃ /┃ ━┛━┛━. |━ ┛ 4 ┃5 ┃6 ┃ + ┃ ━┛━┛━┛━┛ 1 ┃ 2 ┃ 3 ┃ =┃ ━┛━┛━┛━┛
An exemplary analysis of the USA-CHINA trade deal by unearthing the main shortcomings and hidden risks. via
Besides managed trade, there are 5 other reasons to be skeptical of the phase one deal with China: 1⃣ Uncertainty over phase 2 2⃣ Restrictive export controls 3⃣ China's growth slowdown 4⃣ Already-changed supply chains 5⃣ Reduced Chinese demand for US goods
.'s calculations: ____________________ ┃China phase 1 ┃ ┃deal purchasing┃ ┃commitments | ┃are unrealistic | └━━━━━━━┘ 7 ┃ 8┃ 9┃ /┃ ━┛━┛━. |━ ┛ 4 ┃5 ┃6 ┃ + ┃ ━┛━┛━┛━┛ 1 ┃ 2 ┃ 3 ┃ =┃ ━┛━┛━┛━┛
"Unappreciated hazards of the US-China phase one deal"