Sat, May 13, 2017 page10

• China, US to trade beef, poultry, LNG

  ‘HERCULEAN ACCOMPLISHMENT’: A trade agreement is to end China’s ban on beef imports from the US that was imposed in 2003 following a case of mad cow disease

  • AP, WASHINGTON
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  China is finally to open its borders to US beef while cooked Chinese poultry is closer to hitting US supermarket shelves as part of a US-China trade agreement.

  The US would also allow US companies to ship liquefied natural gas (LNG) to China as part of the bilateral agreement reached following US President Donald Trump’s meeting with Chinese President Xi Jinping (習近平) last month.

  It covers a range of barriers from agriculture to energy to the operation of US financial firms in China.

  US Secretary of Commerce Wilbur Ross hailed the agreement as “a Herculean accomplishment” forged in record time.

  “This is more than has been done in the whole history of US-China relations on trade,” Ross told reporters on Thursday evening at the White House. “Normally trade deals are denominated in multiple years, not tens of days.”

  In Beijing, Chinese Vice Minister of Finance Zhu Guangyao (朱光耀) told reporters that the early results of the agreement showed that economic collaboration between the two sides “couldn’t be closer.”

  However, while the agreement touches on many of the trade barriers US companies have long complained about, it remains to be seen how far China will go to allow more US exports.

  Previous US administrations have hailed market-opening agreements only to be left disappointed.

  “The key in these negotiations is specifics that are enforceable — literally the devil is in the details,” said Scott Mulhauser, the former chief of staff at the US embassy in Beijing.

  “The more these agreements include real, concrete outcomes rather than platitudes, rehashing old ground or punts to the future, the better they are. American companies, workers, farmers and more are eager for more access to Chinese markets, and they’ll look to ensure reality matches the rhetoric of these promises,” Mulhauser said.

  Trump has made the US’ massive trade deficits, and specifically the gap with China, a major issue in his campaign and during the early days of his administration.

  He has said that the US’ perennial trade deficits have cost millions of factory jobs and pledged to take a tougher stance in trade negotiations to lower the imbalances.

  Under the agreement, the US would welcome Chinese companies negotiating agreements to purchase US-produced LNG.

  The US Department of Energy has already authorized the shipment of 543.7 million cubic meters per day of natural gas exports to China and other interested countries, the US Department of Commerce said.

  A number of US companies are seeking permits to build facilities to process liquefied gas, which would allow the US to become a net exporter of gas, something it has not been since the 1950s.

  China is attempting to turn to natural gas as a way to reduce its dependence on coal and combat the country’s extensive air pollution.

  The move would allow China to diversify its supply and provide a significant market for US suppliers — though the expansion could boost prices for US consumers.

  Ross downplayed the impact, pointing to the decline in natural gas prices.

  “If you look at it on a historical basis, there’s plenty of room to go back up,” he said. “It’s not as though this is going to wreck anybody’s pocketbook.”

  The agreement would also ease import restrictions on agricultural goods, including ending China’s ban on beef imports that was imposed in 2003 after a case of mad cow disease.

  In exchange, the US would allow the sale of cooked Chinese poultry — a move Ross said could be done safely.

  “We do not intend to endanger anybody’s health or safety in the US,” he said.

  The agreement would also streamline the evaluation of pending US biotechnology product applications; pave the way for allowing US-owned suppliers of electronic payment services to begin the licensing processes in China; and facilitate the entrance of Chinese banks into the US banking market, among other measures.

  The US’ trade deficit in goods and services with China last year totaled US$310 billion, by far the largest imbalance with any country.

  The deficit with China represented about 60 percent of the US’ total deficit last year of US$500.6 billion.

  The two countries have also agreed to hold high-level talks this summer to be led by Ross, US Secretary of the Treasury Steven Mnuchin and Chinese Vice Premier Wang Yang (汪洋) to work on a one-year plan.

  The talks represent the latest effort to resolve contentious trade issues between the world’s two largest economies in a process that began during the administration of former US president George W. Bush under former US secretary of the Treasury Henry Paulson.

  Both countries got together twice a year. The administration of former US president Barack Obama continued the effort, but reduced the frequency of the talks to once a year.

  While Trump had earlier said China could receive more favorable trade terms from the US in return for help in persuading North Korea to cease its nuclear and missile activities, Zhu downplayed any suggestion of a link between the two.

  “Both sides have a deep and close understanding that the US-China economic relationship can’t be politicized.” Zhu said.
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