US blames China for failing to meet procurement targets under 2020 trade deal

“China has made great strides in implementing its commitments to purchase American goods and services in 2020 and 2021,” the Office of the US Trade Representative said in a report to Congress.

“As long as China’s unfair, non-market, and distorted policies and practices persist, the United States can strategically use domestic trade tools to achieve more equal opportunities for workers and businesses with China,” the report said. ready to use.” ,

The report stopped short of detailing any specific action, however, nor did it provide any guidance on how quickly the administration could take action.

The shortfall assessment came in a report on China’s compliance with its international trade obligations and set forth some of the administration’s most detailed views on China.

The report criticized the terms of the 2020 trade deal brokered by the former Trump administration, saying it “doesn’t meaningfully address the more fundamental concerns that the United States has about China’s state-led, non-market policies and practices and their harmful effects on the US economy and American workers and businesses.”

The USTR said it would continue to pressure China to meet its commitments under the agreement. China missed its targets to buy more than $100 billion in US agriculture, energy products and manufactured goods.

China implemented many of the deal’s commitments on other steps, such as opening its markets to new agricultural products, US financial services, but did not fulfill all of these commitments either.

“As a starting step, the United States is working to ensure that China meets its current trade commitments, including those included in the Phase I agreement,” the USTR said. “It’s important to demonstrate the bilateral relationship. That commitments matter.”

The Chinese embassy in Washington did not immediately respond to a request for comment. In the past, China has said implementation of the deal was hampered by the pandemic but was working to meet commitments.

The USTR specifically highlighted that China did not take steps toward studying ractopamine, a feed additive widely used in the US to make lean pork and beef—but Banned in China. The issue has long been a priority for US meat exporters, who say China’s acceptance of the additive will boost their industry.

The USTR also indicated it was ready to take new action to address China’s industrial policies, which it says put US competitors at a disadvantage.

However, since last year, the Biden administration has been considering confronting China more directly over its use of massive industrial subsidies. The administration is considering launching an investigation into sugar subsidies under Section 301 of the US trade law, which could lead to new tariffs.

The US could also take more targeted actions such as revising existing tariffs against China or using the existing system of anti-dumping and countervailing duty tariffs to impose tariffs on heavily subsidized goods.

For example, a new Section 301 investigation requires a month-long process and a detailed report on the business practices of the concern before any new tariffs will actually be imposed.

The Trump administration also initially sought, but ultimately failed, to make any changes to its subsidy practices to China negotiated as part of a phase one deal. Such issues were intended to be addressed in the Phase II deal, but serious negotiations for Phase II did not begin during Trump’s presidency and were not pursued by Biden.