How US-China relations drastically changed in 2020

A file pic of Trump and Xi

Ten months have passed since U.S. President Donald Trump and China’s Vice Premier Liu He signed the US–China Phase One trade deal in Washington DC. But things have been in a see-saw mode throughout the months.

Here’s tracking some of the significant developments that marked US-China relations in 2020.

January 3:

Reuters reported that in December 2019 the American manufacturing sector fell into its deepest slump in over a decade, attributing the decline to the U.S.-China trade war.

January 15:

U.S. President Donald Trump and China’s Vice Premier Liu He signed the US–China Phase One trade deal in Washington DC.

U.S. President Donald Trump and China’s Vice Premier Liu He signed the US–China Phase One trade deal in Washington DC.

The “Economic and Trade Agreement between the United States of America and the People’s Republic of China” is set to take effect from February 14, 2020 and focuses on intellectual property rights (Chapter 1), technology transfer (Chapter 2), food and agricultural products (Chapter 3), financial services (Chapter 4), exchange rate matters and transparency (Chapter 5), and expanding trade (Chapter 6), with reference also being made to bilateral evaluation and dispute resolution procedures in Chapter 7.

Unlike other trade agreements, the US–China Phase One agreement did not rely on arbitration through an intergovernmental organization like the World Trade Organization, but rather through a bilateral mechanism.

January 17:

Official figures from China showed its 2019 economic growth rate falling amid the trade war to a 30-year low.

February 5:

Data from the Commerce Department of the United States showed the country’s trade deficit falling amid the trade war for the first time in 6 years.

February 17:

China grants tariff exemptions on 696 US goods to support purchases.

March 5:

The United States Trade Representative granted exemptions to tariffs on various types of medical equipment, after calls from American lawmakers and others to remove tariffs on these products in light of the COVID-19 pandemic in the United States.

May 12:

The Chinese government announced exemptions for tariffs on 79 additional US goods.

June 2020

As of June, China had risen to become the United States’ top trading partner again, amid the global crisis caused by the COVID-19 pandemic. However, the countries were not on track to meet the targets from the trade deal, which would have been a challenge even under strong economic conditions, according to Chad Brown of the Peterson Institute for International Economics and Chenjun Pan of Rabobank. The economic damage and barriers to trade caused by the pandemic made those targets even harder to reach.

September 15:

A three-person WTO panel found that the Trump administration tariffs violated global trade rules because they had been applied only to China and they exceeded the maximum rates the US had agreed to, without adequate explanation. Lighthizer responded that the finding showed “the WTO is completely inadequate to stop China’s harmful technology practices.”

September 26:

The US Commerce Department imposed restrictions on China’s largest chip maker, Semiconductor Manufacturing International Corporation (SMIC), determining that an “unacceptable risk” equipment supplied to SMIC could potentially be used for military purposes. Under the restrictions, the suppliers were barred from exporting the chip without a license.

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