Spencer Cohen and Badri Narayanan
To induce better trade policies in China, multilateralism is the only effective approach. By building alliances and consensus among like-minded nations, the US can rebuild and strengthen the rules of the road for China to observe.
The phase one trade deal, signed on January 15, 2020, was lauded by the Trump administration as a breakthrough in the long-standing impasse in US-China trade relations. It is not. Setting aside the impact of the pandemic on global trade flows and hindrance to the deal’s success, it was flawed from its inception as a bilateral agreement.
The failure follows on the heels of a trade war that has harmed US households, farmers, manufacturers and exporters. President-elect Joe Biden’s administration should not overtly rescind the deal but let it sail into the sunset, along with the ineffective trade policies of the Trump administration, and start anew.
For starters, the deal has not met its trade targets. The signature element was China’s agreement to increase purchases of US goods and services by US$200 billion above 2017 levels during the next two years. This included a US$76.7 billion increase in US exports of goods and services in 2020 compared with 2017 levels, the last year before the trade war.
This article was originally published in South China Morning Post