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As Canada’s diplomatic spat with China continues, United States and the communist regime buried their trade war hatchets this week to sign phase one of a new trade deal both countries say will bolster their respective economies.
Phase one of a new agreement inked between United States and China on Wednesday could be worth more than $200 billion in additional trade for American businesses and opens up China to the U.S. financial sector.
In a rambling speech in Washington DC, U.S. President Donald Trump caged the agreement as a win-win for bilateral relations and “a sea change in international trade.”
At a glance, China agrees to increase imports of U.S. goods and services by $200 billion over the next two years (with 2017 as benchmark), in exchange for partial tariff rollbacks on some American imports of Chinese goods worth approximately $360 billion.
“We’re leaving tariffs on, which people are shocked, but it’s great,” boasted Trump.
“But I will agree to take those tariffs off, if we are able to do phase two. In other words, we’re negotiating with the tariffs.”
Additional terms of the 96-page agreement address increasing protection for intellectual property rights, including on transfers of technology, as well as China’s commitment to purchase $40 billion worth of U.S. agriculture product annually, over the next two years.
Despite that the highest value of U.S. agriculture exports to China peaked in 2013 at $29 billion in 2013, Trump expressed his inimitable confidence in American farmers.
“They say, ‘Sir, our farmers can’t produce that much.’ I said, ‘I love our farmers. Let them tell me they can’t do it.'” he said of advisors on America’s agriculture production envelope.
“And I said, ‘Tell them to go out and buy a larger tractor. Buy a little more land.’ But they’ll be able to do it. I have no doubt they’ll be able to do it.
The president’s expansive introduction that kept the Chinese delegation waiting more than 30 minutes according to an annoyed CBS reporter, included personal shoutouts to industry leaders like Continental Resources’s founder Harold Hamm.
“Other guys spend billions and billions of dollars; they can’t find oil. This guy takes a straw, he goes like this, and oil pops up,” said Trump of the man whose company has logged record oil production in recent years.
“He puts a straw into the ground, and oil pours out. It’s true.”
America’s strong oil and gas sector–driven largely by hydraulic fracturing and unbridled under Trump’s deregulation polices–has made the U.S. energy independent for the first time in nearly a decade; a position the president has leveraged to great effect in the Middle East.
China’s vice-premier Liu He, who took part in phase one negotiations, attended the signing ceremony on behalf of his country and read a letter from President Xi Xiping before signing the agreement.
“The phase one trade agreement between China and the U.S. is good for China, for the U.S., and for the whole world. It also shows that our two countries have the ability to act on the basis of equality and mutual respect,” writes Xi.
“In the next step, the two sides need to implement the agreement in real earnest and optimize its positive impact so as to make even greater progress in China-U.S. trade and economic cooperation.”
A central theme of the trade deal is that either signatory is not required to re-write domestic laws for implementation. China also maintains its ability to provide state subsidies to industry, a matter that the U.S. is expected to contest during phase two talks.
But heading into an election year, Trump appeared to treat the phase one signing ceremony as a victory lap for his first term; even teasing several people present for the occasion including Liu.
“Negotiating with Liu is very tough…I’d like you to just relax a little while. Take it easy. Go out, see a movie,” Trump said to China’s vice-premier.
“Tell President Xi I said, ‘President, go out. Have a round of golf. See a movie.’ “No, no, no. I am too busy. But they are workers. This China is an incredible, incredible nation.”
At certain points, the event took on shades of a Trump rally as POTUS chided his Democrat Senator nemesis “Cryin’ Chuck Schumer” and cracked a joke about interim eBay CEO Scott Schenkel profiting from his autograph.
“‘Sir,…would you sign my sneaker?’” Trump said in his lengthy preamble.
“‘Yes.’ Then, two nights later, I see it on eBay, selling for $5,000. I say, ‘What kind of people are these?’ Terrible. Sometimes it’s the senators and the congressmen that do it!”