US-China trade: ‘building a wall’ will not address ‘problems posed by China’, Washington warns

Biden administration’s first assessment of China’s compliance with the World Trade Organization says Beijing’s actions ‘cause serious harm to workers and businesses around the world’

New trade report also says China ‘plainly does not hold the same core values’ that the US and its closest allies hold

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A new report by the office of US Trade Representative Katherine Tai (pictured) stresses the need to level the playing field with China and counter its policies and practices. Photo: Reuters

Published: 6:00pm, 16 Feb 2022Updated: 6:16pm, 16 Feb 2022

The United States is looking to avoid “building a wall” between itself and China on trade, as doing so would adversely affect American interests. But at the same time, Washington aims to maintain a “technological edge” over its strategic rival.

The fresh comments came on Wednesday in the US Trade Representative Office’s latest annual review of China’s compliance with the World Trade Organization (WTO) – the first such assessment under President Joe Biden’s administration.

US Trade Representative (USTR) Katherine Tai also urged China to live up to its commitments in the phase-one trade deal, as doing so would “provide a solid foundation for future bilateral engagement”.

And in a break from last year’s assessment by the previous administration of Donald Trump, the latest report dropped any mention of a separate “phase two” trade negotiation with China, but said that “an initial step” of the US’ strategic approach involves addressing the unresolved issues under the phase-one trade deal, although the purchasing commitments expired at the end of 2021.

China had vowed to buy an additional US$200 billion worth of American goods over 2017 levels, but a report released by the Peterson Institute for International Economics last week said China purchased only 57 per cent of the US exports it had committed to buy under the two-year agreement, which was “not even enough to reach its import levels from before the trade war”.