U.S. and China agree on beef trade deal
- Author: Leroy Wright May 25, 2017,
May 25, 2017, 17:54
In an initial trade deal announced by both sides in their capitals, Beijing will allow USA beef, banned since 2003, into China by July, give American financial services firms access to the Chinese market, and may import American liquefied natural gas. It is part of 100 days of talks created to ease trade friction between the world's two largest economies, with tensions stoked by Donald Trump's complaints over the trade imbalance and Chinese market barriers. It's at least a $2.5 billion market that's being opened up for USA beef.
It also suggests still wider room for compromise.
The U.S. commerce chief said the deal will help reduce the U.S. trade deficit with China, which reached almost $350 billion a year ago.
It's been almost 14 years since China banned imports of USA beef following the December 23, 2003 announcement that a Holstein cow had been diagnosed with BSE.
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Area producers believe once China starts to get US beef again that there will be a significant increase on the entire cattle industry.
China and the U.S have reached a ten-point trade agreement. "Clearly China, whose banks are among the largest in the whole world, wants access to the US banking market".
America's trade deficit in goods and services with China totaled $310 billion a year ago, by far the largest imbalance with any country. The deficit with China represented about 60 percent of last year's total deficit of $500.6 billion.
CGTN's Rachelle Akuffo spoke to Dan Ikenson, director of the Herbert A. Stiefel Center for Trade Policy Studies at the Cato Institute about the significance of the recent China-U.S. trade deal. The deficit with China represented about 60 percent of the country's total deficit previous year of $500.6 billion.
Yet beef exports alone will do little to fill the trade gap.
The opening of the bond market could bring in USA institutional investors, which may stem the capital flight that troubles the Chinese government.
How much that could increase with access to China is uncertain.
"Restoring U.S. beef exports to China opens the door to sell high quality, safe and delicious Kansas beef to almost 1.4 billion new customers in China", Brownback said. The two sides have reached a deal to boost trade. "The economic impact is going to extend more than just beyond the beef industry".
"I think people are coming to realize Chinese beef isn't necessarily worse", Sun said. The latest agreement also includes their preparations to open up U.S. exports of liquefied natural gas to China. "Additionally, opening up Chinese markets to US natural gas will help to reduce flaring and create good jobs". "The U.S. economy is not fundamentally based on Wall Street and farms, it's based on advanced industries".
The plan does not address any tech-related issues championed by the USA tech industry, such as intellectual property protection, prohibition of data localization requirements and addressing the Chinese-government backed subsidies aimed to grow the country's domestic semiconductor sector.
Those in the livestock industry also hope other countries may follow in China's footsteps.
"This was pretty much a herculean accomplishment to get this done", U.S. Commerce Secretary Wilbur Ross told reporters at the White House, according to Bloomberg News. "They have a great professional spirit that's worth studying".
National Cattlemen's Beef Association President Craig Uden issued a statement applauding the announcement.