The United States Trade Representative has launched a compliance review to scrutinize China’s adherence to its economic and trade commitments with the U.S., which could significantly impact future trade discussions.
Key Takeaways
- The U.S. announced a compliance review to assess China’s adherence to its trade commitments.
- This follows President Donald Trump’s “America first trade policy.”
- The review’s scope concerning the phase one agreement remains unspecified.
- The compliance review aligns with the “America First Trade Policy” memorandum.
Compliance Review Initiated
The White House has announced a compliance review regarding the Economic and Trade Agreement between China and the United States, focusing on whether China fulfills its agreed commitments. This initiative stems from the “America first trade policy” advocated by President Donald Trump, intending to protect American industries and ensure fair trade practices.
The review, however, does not explicitly clarify if it pertains to the phase one trade agreement signed in January 2020. Yet, Scott Bessent, Trump’s nominee for Treasury Secretary, mentioned that the phase one agreement would be the foundation for future trade negotiations with China. This stance was echoed by Jamieson Greer, nominated as the U.S. Trade Representative, who played a role in negotiating the initial deal.
The Office of the United States Trade Representative announced today that it will review the Economic and Trade Agreement Between the Government of the United States of America and the Government of the People’s Republic of China (PRC) to determine whether the PRC is acting in…
— Craig Shapiro (@ces921) January 24, 2025
China’s Challenges to Global Trade
The U.S. Trade Representative recently released the 2024 Report to Congress on China’s compliance with WTO commitments, highlighting China’s challenges to the international trading system. Ambassador Katherine Tai stated, “China continues to represent the biggest challenge to the international trading system. After 23 years of membership in the World Trade Organization, China still embraces a state-directed, non-market approach to the economy and trade, which runs counter to the norms and principles embodied in the WTO.”
The report elaborates on China’s non-market policies and practices, believed to harm global industries.
Ensuring Compliance and Future Directions
The compliance review aims to verify if China is “acting in accordance with the commitments it made in the agreement,” as noted by the Office of the U.S. Trade Representative. This action aligns with a Presidential Memorandum titled “America First Trade Policy,” signed on January 20, 2025. The memorandum reinforces the U.S. commitment to holding trading partners accountable for compliance to protect American economic interests.
This review plays a critical role in maintaining the integrity of trade relations between the world’s two largest economies. Understanding the gravity of adherence to international trade agreements, the U.S. aims to ensure fair competition and equitable trade practices moving forward.
