Explainer | US-China trade war: was the phase-one trade deal a ‘historic failure’, and what’s next?

The US and China signed their long-awaited phase-one trade deal in January 2020, with China agreeing to buy an additional US$200 billion worth of goods and services

But according to a report, China bought only 57 per cent of the US exports it had committed to purchase over the two years of the deal

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The phase-one trade deal was formally signed on January 15, 2020, by Trump and Chinese Vice-Premier Liu He, with its provisions taking effect one month later. Photo: Xinhua

Published: 4:00am, 27 Feb 2022

When did the US-China trade war start?

During his 2016 presidential campaign, Donald Trump promised to reduce the trade deficit with China.

The United States and China are the two largest economies in the world and bilateral trade between them totalled almost US$559 billion in 2019. However, that trade has been lopsided, with the US running a large and growing trade deficit with China. The US’ trade shortfall rose toUS$378 billion in 2018, up from US$103.1 billion in 2002.

The US-China trade war started on July 6, 2018, when the US imposed a 25 per cent tariff on US$34 billion worth of Chinese imports, marking the first in a series of tariffs imposed during 2018 and 2019.

It continued to escalate, with the US and China imposing various import tariffs on each other’s products until an agreement in principle on their so-called phase-one trade deal was reached in mid-December 2019.

At its peak at the end of 2019, the US had imposed tariffs on more than US$360 billion worth of Chinese goods, while China had retaliated with US$110 billion worth of import duties on US products.

What was the phase-one trade deal?

The phase-one trade deal was formally signed on January 15, 2020, by Trump and Chinese Vice-Premier Liu He, with its provisions taking effect one month later.

As part of the deal, China agreed to buy an additional US$200 billion worth of American goods and services over the following two years, compared with 2017 levels.

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Explainer | US-China trade war: was the phase-one trade deal a ‘historic failure’, and what’s next?

The US and China signed their long-awaited phase-one trade deal in January 2020, with China agreeing to buy an additional US$200 billion worth of goods and services But according to a report, China bought only 57 per cent of the US exports it had committed to purchase over the two years of the deal

When did the US-China trade war start?

What was the phase-one trade deal?