Janet Yellen, the United States Secretary of the Treasury, has criticized the Trump administration’s trade deal with China. The Treasury Secretary is the first official to voice concern about the U.S.-China agreement.
In an interview with The New York Times (NYT) on the 16th (local time), Secretary Yellen criticized the U.S.-China Phase 1 trade deal for “not addressing the fundamental issues” as she concluded his European tour. “Tariffs are a kind of tax on consumers,” she added.
In January 2020, the United States and China signed an agreement that requires China to buy more U.S. goods. About 18 months after the trade agreement was signed, China is not keeping its promise to buy U.S. products because of the COVID-19 outbreak.
Since the Trump administration, the U.S. has imposed tariffs on $360 billion in Chinese imports. In sectors such as automobiles and aerospace, the Trump administration has been targeting Chinese companies that provide subsidies to U.S. exporters. Despite the U.S.-China deal, the U.S. trade deficit has not shrunk, but rather has grown rapidly. China’s exports to the U.S. reached a record high in the first quarter of last year. The reason is because a large number of medical products were imported from China following the Covid-19 outbreak.
In its six months in office, Joe Biden’s administration has reviewed its trade policy towards China.
Yellen’s remarks indicate a changed approach to China’s trade policy by the United States.
U.S. media predict that the pressure on China will not ease under the Biden administration, whether it scraps, keeps or replaces the existing U.S.-China trade agreement.
The New York Times reported that China would be happy if the U.S. lifted tariffs, but would not make concessions to end its own subsidies in order to revise the trade agreement.