China rejects US claims it's not living up to trade commitments

BEIJING • China yesterday fended off accusations that it had not honoured its commitments to a 2020 trade pact with the United States, calling instead for Washington to lift punitive tariffs and sanctions "as soon as possible".

The comments came as US figures on Tuesday showed the trade deficit with China ballooning by US$6 billion (S$8 billion) to US$34.1 billion last December.

After a long-running stand-off, the two countries reached a "phase one" deal in January 2020, in which Beijing pledged to increase its purchases of American goods and services by at least US$200 billion through 2020 and 2021.

The deal followed a long-running trade war that saw then US President Donald Trump impose punitive tariffs on hundreds of billions of dollars worth of Chinese products, dealing a severe blow to relations.

Washington has complained that Beijing is not holding up its side of the agreement, with Tuesday's Commerce Department figures laying bare the yawning deficit.

On the same day, the Peterson Institute for International Economics, a Washington-based think-tank, said China was "never on pace to meet its purchase commitments".

China rejected that accusation yesterday, arguing that the nation had done its best to live up to the terms of the 2020 deal.

"Since the agreement took effect, China has made efforts to overcome the negative impact of the pandemic, global economic recession and supply chain disruptions to push for both sides to implement the agreement," Ministry of Commerce spokesman Gao Feng said in Beijing. "We hope the US will cancel tariffs on Chinese goods and other punitive measures, to create a good environment for the two sides to expand their trade."

Ties between the two countries deteriorated under Mr Trump, who imposed tariffs on US$370 billion worth of Chinese products in 2018, citing trade practices Washington deemed "unfair" and slamming the huge trade deficit.

But many US companies have criticised the levies, saying they drove up costs, since importers had to bear the brunt.

In early October, US Trade Ambassador Katherine Tai said President Joe Biden would keep the punitive duties in place. A month later, she said she was "optimistic" about discussions with China, but remained non-committal about what actions Washington might take if Beijing failed to live up to its commitments.

Officials from the largest US business lobby group yesterday said the Biden administration is considering a new China tariff probe if talks fail to persuade Beijing to follow through on its promise.

The administration is considering other options too, including working more closely with US allies to present a united front against China in demanding a level playing field for international firms, said Mr Myron Brilliant, the US Chamber of Commerce's head of international affairs.

AGENCE FRANCE-PRESSE, REUTERS