US trade chief Tai says he will ‘get in touch’ with China in ‘Phase 1’ deal talks – Community News
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US trade chief Tai says he will ‘get in touch’ with China in ‘Phase 1’ deal talks

Katherine C. Tai addresses Senate Finance Committee hearings to examine her nomination as United States Trade Representative to the rank of Ambassador in Washington, DC, Feb. 25, 2021. Bill O’Leary/Pool via REUTERS /File Photo

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WASHINGTON, Nov. 10 (Reuters) – The Biden administration is gaining traction with China in talks over Beijing’s compliance with a Trump-era trade deal, U.S. Trade Representative Katherine Tai said on Wednesday, but declined to predict an outcome as the discussions continue.

Tai told reporters in Washington that the government is committed to holding China accountable for the two-year “Phase 1” trade deal signed in January 2020, and is investigating all weaknesses in China’s performance, including the lack of commercial aircraft purchases.

She said talks with Beijing on the Phase 1 deal are being twinned with discussions of bigger issues, including China’s “extremely robust” state-driven industrial policies that make it difficult for US companies to compete.

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“I think we see this Phase 1 agreement as the first step,” Tai said. “And it’s not in my best interest for this first step to take a very, very long time.”

China is lagging far behind on its deal promises to increase purchases of US goods by $200 billion in 2020 and 2021 compared to 2017 levels, meeting only 60% of its target by Sept. 30, according to data collected by trade economist Chad Bown of the Peterson Institute for International Economics.

The deal also includes promised steps by China to improve protection of US intellectual property and increase market access for US agricultural biotechnology products and financial services.

Asked whether she urged talks for China to take steps to enable the purchase of commercial aircraft from Boeing (BA.N) – a purchase category identified in the Phase 1 agreement – Tai said: “If you look at where the weaknesses might be, in terms of phase 1, you would expect us to talk through it and examine everything.”

US President Joe Biden and Chinese President Xi Jinping have already scheduled a virtual meeting next week amid mounting tensions between the world’s two largest economies.

Tai said the meeting would be helpful and their understanding of each other would benefit a complex relationship. But she said the leaders’ involvement was not necessary to facilitate trade talks.

“I don’t want any of you in this room thinking we can’t get a handle on our Chinese counterparts,” Tai said. “We talk and we work. So we don’t need fathers to come in,” she added, referring to Biden and Xi.

Asked whether the government is considering cutting tariffs on Chinese goods as a way to ease inflationary pressures on the US economy, Tai said USTR views “Section 301” tariffs on Chinese goods as part of a strategy to advantageous position to compete more effectively with China.

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Reporting by David Lawder; Editing by Howard Goller and Richard Pullin

Our Standards: The Thomson Reuters Trust Principles.