President Donald Trump and the Chinese government are both touting agreement on a phase 1 trade deal, but Pro Farmer policy analyst Jim Wiesemeyer says history shows that a deal will only matter once it’s in writing.
“We had an agreement in principle on October the 11th per President Trump in an Oval Office video,” Wiesemeyer says in an interview with AgDay’s Clinton Griffiths. “What he said at that time was ‘we had to paper it,’ meaning that they had to put words on paper. We’re basically back to that same development. So that’s why I and others are skeptical here.”
One major difference between the Oct. 11 announcement and today, however, is that the Chinese government said publicly Friday morning that there is an agreement “in concept.”
Neither side, however, is offering any specifics on what this latest agreement might mean for agricultural purchases by China. As part of the Oct. announcement President Trump indicated the agreement would require up to $50 billion in U.S. ag purchases by China. In Friday’s press conference, Chinese officials said any ag purchases had to be market driven.
A statement from the U.S. Trade Representative’s office said the agreement “includes a commitment by China that it will make substantial additional purchases of U.S. goods and services in the coming years.”
“I hate to say it, but we’ve been burned before,” WIesemeyer says. “I don’t care what Trump is saying on the $50 billion. Verify it with text and verify it with the Chinese officials’ comments and, if that’s the case, let’s get on with it.”
Wiesemeyer says there is no clear timeline for finishing and signing a phase 1 deal. The president in a pair of tweets said negotiations on phase 2 will start immediately.
We have agreed to a very large Phase One Deal with China. They have agreed to many structural changes and massive purchases of Agricultural Product, Energy, and Manufactured Goods, plus much more. The 25% Tariffs will remain as is, with 7 1/2% put on much of the remainder....— Donald J. Trump (@realDonaldTrump) December 13, 2019
.....The Penalty Tariffs set for December 15th will not be charged because of the fact that we made the deal. We will begin negotiations on the Phase Two Deal immediately, rather than waiting until after the 2020 Election. This is an amazing deal for all. Thank you!— Donald J. Trump (@realDonaldTrump) December 13, 2019