The US President Donald Trump and Chinese Vice Premiere Liu He had signed off an initial US-China trade deal late on Wednesday, the 15th of January 2020, dubbed as “Phase One” US-China trade deal, which in effect would curb out some US tariffs on Chinese goods, but would leave a bruising 25 per cent tariff on $250 billion worth of Chinese imports at least until end-2020, in exchange for China’s pledges to purchase more US farm goods, energy alongside manufactured goods and a small-scale overhaul of China’s intellectual property practice, remarking the first prudent step forward to resolve their deep differences.
As it stands, although China had yet to reveal a Chinese version of the deal, followings are the details of the "Phase One" trade agreement released late on Wednesday (January 15th) by the office of USTR (United States Trade Representative).
China purchases: Under the terms of the “Phase One” Sino-US trade deal, Beijing had agreed to step up purchases of American goods and services by as little as $200 billion over the next couple of years including $77.7 billion in additional factory goods purchases, $52.4 billion in energy purchases alongside $37.6 billion in services from US firms and another $32 billion in agricultural purchases.
Tariffs withdrawals: According to the 85-page paddling of Sino-US “Phase 1” deal, the Trump Administration would slash China tariff by half which it had imposed since September 1st over a $120 billion worth of Chinese goods to 7.5 per cent, while a 25 per cent US tariff on $250 billion worth of Chinese goods would stay in place until “Phase Two” US-China trade deal, US Treasury’s Mnuchin and US President Donald Trump said in separate statements on Wednesday (January 15th).
Apart from that, another tariff hike which was scheduled to go into effect by December 15th on $160 billion worth of Chinese goods alongside a proposed 25 per cent retaliatory tariff on US made autos had been cancelled permanently.
Intellectual property & Currency: The “Phase One” deal included China’s pledges to eradicate any kind of pressure for the foreign companies to transfer intellectual properties or technologies to Chinese firms, while under the terms of the deal, Beijing had also promised not to devalue its currency to obtain competitive advantages over US exports.
Chinese market access: On top of that, officials from USTR had also added that under the “Phase 1” agreement, China had assured an improved access for US firms in to China’s financial services market such as conventional lending and depository banking, insurance, credit rating services alongside securities.