U.S. President Donald Trump’s phase-one trade deal with China, one of the few glimmers of success to come out of three years of harmful trade wars, was already dying a slow death as the economic devastation of the coronavirus pandemic made his massively ambitious trade targets all but unreachable.
Now, the Chinese government appears to be reneging on the sputtering deal, reportedly telling state-owned agricultural firms to halt purchases of U.S. soybeans, one of the major U.S. agricultural exports to China and a pillar of the deal’s promised $200 billion in extra exports. Beijing’s move, first reported by Bloomberg News, followed Friday’s U.S. announcement that Washington will potentially take steps to revoke Hong Kong’s special status and possibly levy sanctions and other economic weapons against both China proper and the once-autonomous region.
The big question now, some say, is not whether the trade deal will survive but what form of trade confrontation will take its place at a time when U.S. economic policy toward China is dictated less by long-term national interest and more by short-term electoral calculations.
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