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Money China to ramp up U.S. car, aircraft, energy purchases in trade deal: source

11:13  14 january  2020
11:13  14 january  2020 Source:   reuters.com

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When the Phase 1 trade deal was struck on Dec. 13, U . S . officials said China had agreed to buy 0 billion in additional U . S . farm products With Chinese car sales flagging and excess domestic assembly capacity on the rise, it' s difficult to see the need for China to purchase significantly more

The source providing the purchase figures expressed skepticism about manufactured goods pledges by Beijing since the U . S .- China trade deal With Chinese car sales flagging and excess domestic assembly capacity on the rise, it' s difficult to see the need for China to purchase significantly more

a close up of a flag: Chinese and U.S. flags are set up for a meeting during a visit by U.S. Secretary of Transportation Elaine Chao at China's Ministry of Transport in Beijing© Reuters/Jason Lee Chinese and U.S. flags are set up for a meeting during a visit by U.S. Secretary of Transportation Elaine Chao at China's Ministry of Transport in Beijing

WASHINGTON (Reuters) - China has pledged to buy nearly an additional $80 billion of manufactured goods from the United States over the next two years, plus over $50 billion more in energy supplies, according to a source briefed on a trade deal to be signed on Wednesday.

Aiding a sector that enjoys a rare trade surplus with China, Beijing would also boost purchases of U.S. services by about $35 billion over the same two-year period, the source told Reuters on Monday.

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more in energy supplies, under a trade deal with China to be signed on Wednesday, a source Beijing would also boost purchases of U . S . services by about billion over the same two-year The Phase 1 agreement calls for Chinese purchases of U . S . agricultural goods to increase by some

(Reuters) - China has offered to go on a six-year buying spree to ramp up imports from the United States in order to reconfigure the relation between the two countries, Bloomberg reported on Friday, citing people familiar with the matter. By raising annual goods imports from the United States by a

The Phase 1 agreement calls for Chinese purchases of U.S. agricultural goods to increase by some $32 billion over two years, or roughly $16 billion a year, the source said.

When combined with the $24 billion U.S. agricultural export baseline in 2017, the total gets close to the $40 billion annual goal touted by U.S. President Donald Trump.

The $32 billion agriculture increase over 2017 was confirmed by Myron Brilliant, the U.S. Chamber of Commerce's head of international affairs, who spoke to reporters on Monday in Beijing.

The numbers, expected to be announced on Wednesday at a White House signing ceremony between Trump and Chinese Vice Premier Liu He, represent a staggering increase over recent Chinese imports of U.S. manufactured goods.

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China has offered to go on a six-year buying spree to ramp up imports from the U . S ., in a Trade Offers. It’ s not the first time China has made an offer to reduce the deficit as a way of trying to In May, Trump scrapped a framework for a deal negotiated by Treasury Secretary Steven Mnuchin that

China has offered to ramp up its purchases of U . S . imports over six years to reach more than trillion per year, Bloomberg News reported, citing officials familiar with the negotiations. The move would end the U . S . trade gap with China by 2024, the report said.

Two other sources familiar with the Phase 1 trade deal agreed with the rough breakdown of the purchases, without providing specific numbers.

A spokesman for the U.S. Trade Representative's office could not immediately be reached for comment.

When the Phase 1 trade deal was struck on Dec. 13, U.S. officials said China had agreed to buy $200 billion in additional U.S. farm products, manufactured goods, energy and services over the next two years, compared to the baseline of 2017.

They said they would publish targets for the four broad areas, but would keep details of specific products classified to avoid market distortions.

Trump had mainly touted the increased farm exports, which would benefit a major political constituency that has been battered by Chinese retaliatory tariffs during his 18-month trade war with Beijing.

Company executives have been waiting eagerly for details of what other U.S. goods China would be buying more of, aside from farm products, after 18 months of tit-for-tat tariffs that have stalled U.S. business investment.

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China has offered to go on a six-year buying spree to ramp up imports from the United States in order to reconfigure the relation between the two Reuters reported on Jan. 9 that U . S . officials used three days of trade talks with Chinese counterparts in Beijing to demand more details on China ’ s pledge to

President Trump’ s economic conflict with China is set to escalate this week, as the administration plans to unveil fresh tariffs on 0 billion in Chinese products entering the U . S . and Beijing debates new ways to retaliate against U . S . corporations doing business in China . The threats from both sides of

MANUFACTURING CHALLENGES

The $80 billion increase for manufactured goods includes significant purchases of autos, auto parts, aircraft, agricultural machinery, medical devices and semiconductors, said one of the sources, without giving the names of any specific suppliers.

The aircraft would likely be built by Boeing Co , the No. 1 U.S. exporter, whose new sales to China have ground to a halt over the past two years. That would be a welcome shot-in-the arm for the planemaker, which has seen shares and earnings plummet as its best-selling 737 MAX aircraft remains grounded due to two fatal crashes in 2018 and 2019.

The source providing the purchase figures expressed skepticism about manufactured goods pledges by Beijing since the U.S.-China trade deal does not address any of the non-tariff barriers that have kept these U.S. goods out of the Chinese market for decades, including procurement rules, product standards and subsidies to Chinese state-owned firms.

With Chinese car sales flagging and excess domestic assembly capacity on the rise, it's difficult to see the need for China to purchase significantly more U.S.-built cars. Among the most popular U.S.-built vehicles sold in China are BMW and Mercedes-Benz sport-utility vehicles.

China also has major industrial policy goals to dominate the very manufacturing sectors in which it has pledged to pump up purchases of U.S. goods, further fueling skepticism.

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Chinese trade practices by making it significantly more difficult for Chinese firms to acquire advanced U . S . technology or invest in American companies. The administration plans to release on Thursday a package of proposed punitive measures aimed at China that include tariffs on imports worth at least

The deal presented to Trump by trade advisers Thursday included a promise by the Chinese to buy more U . S . agricultural goods, according to the people. Officials also discussed possible reductions of existing duties on Chinese products, they said. The terms have been agreed but the legal text has not

Many economists and experts are dubious that the Phase 1 trade agreement will be implemented as written, despite what U.S. officials describe as an important enforcement clause in the deal.

That enforcement mechanism allows grievances to be aired through escalating consultations that would reach Chinese Vice Premier Liu He and U.S. Trade Representative Robert Lighthizer.

If a U.S. claim of Chinese non-compliance cannot be resolved, Washington would have the right to reimpose tariffs on Chinese goods in proportion to the economic damage alleged. But nothing would preclude China from retaliating, returning the two sides to the current status quo, people familiar with the deal said.

Lighthizer on Monday called the deal a "huge step forward" for U.S.-China trade relations and "a really, really good deal for the United States." He told Fox Business Network that Beijing's compliance would be monitored closely.

"We expect them to live up to the letter of the law. We'll bring cases, we'll bring actions against them if they don't," Lighthizer said.

(This story has been refiled to correct day in fifth paragraph)

(Reporting by David Lawder and Andrea Shalal; Additional reporting by Gabriel Crossley in Beijing; Editing by Simon Cameron-Moore)

EU warns of WTO challenge if China-US deal creates 'distortions' .
The European Union will challenge the China-US trade agreement at the World Trade Organization if it creates "distortions" in the market that harm EU companies, the bloc's envoy to Beijing said Friday. Ambassador Nicolas Chapuis told reporters the 28-nation EU "will monitor the implementation" of the "phase one" deal that was signed on Wednesday by President Donald Trump and Chinese Vice Premier Liu He. "In our opinion, quantitative targets are not WTO-compatible if they lead to trade distortions," Chapuis said. "If it were to be the case, we will go to the WTO to settle this matter.

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