All Smiles in U.S.-China Trade

Location China. Green pin on the map.

The mini-deal has finally arrived, but we shouldn’t be blamed for wanting to see actual text of the agreement before deciding whether the outcome was worth the pain. After many fits and starts, including an Oval Office berating of USTR Ambassador Lighthizer in February and List 4 tariffs now mostly on hold, the trade war journey has zigged as much as it has zagged.

Showmanship aside, details of the trade detente are noticeably lacking. Reports point to increased farm purchases of $40-$50 billion (a significant jump from pre-trade war amounts of $24 billion), improved market access for U.S. financial services (abolishing ownership restrictions by 2020), and yet-to-be-determined concessions on intellectual property protection. Of course, the deal doesn’t address larger systemic issues such as industrial state policies or national security concerns.

The question that now arises is whether this agreement, assuming that a text is ultimately signed, will be enough for the President to claim victory and thus deliver some level of predictability to international trade?