More US agricultural products on way
More agricultural products imported from the United States will help meet demand from Chinese consumers and promote supply-side structural reform in the agricultural sector, experts said on Thursday.
Their analysis followed the signing of the phase-one China-US trade agreement on Wednesday in Washington, winding down a 22-month trade dispute between the world’s two biggest economies.
Under the agreement, China will purchase more US agricultural products, including beef, pork, wheat, dairy, rice and aquatic products, from now until the end of 2021. The US will allow Chinese agricultural products, such as fragrant pears, citrus and jujube, to enter the US market.
These moves could create more space for both sides to enlarge trade volume with even more agricultural products in the next stage if the terms on the agreement can be smoothly implemented, said Cheng Dawei, professor of international trade at Renmin University of China’s School of Economics.
The US and China are complementary in the agricultural sector. Increasing domestic demand for high-quality products and the Chinese people’s diverse dietary habits will ensure the country can absorb the increased US imports, Cheng said, adding that the agreed purchases are based on changing domestic conditions.
Although Sino-US trade fell by 10.7 percent to 3.73 trillion yuan ($542.13 billion) in 2019 because of the trade tussle, China’s imports from the US recovered some lost ground in the final two months of last year. US shipments to China rose 9.1 percent year-on-year to 78.83 billion yuan in December, according to the General Administration of Customs.
Agricultural products coming from the US to China reached 14.1 billion yuan last month, a surge of 200 percent year-on-year, the GAC said.
The trade deal with the US will not adversely affect the Chinese economy because China has pledged to further promote its domestic economic development based on mutual benefit, said Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation.
He stressed that the additional imports of US agricultural products must be based on market demand and World Trade Organization rules. The prices of those US products should be competitive and meet the quality and safety standards required by the Chinese authorities.
If US companies want to increase their market share in China, they must improve the competitiveness of their products, Mei said, adding that it is advisable for them to enter into more partnerships with domestic companies in the processing and retail sectors to boost their understanding of the local market, Mei said.