FX.co ★ Coronavirus weakens China’s trade position

Coronavirus weakens China’s trade position

Coronavirus has already significantly weakened China’s trade position. The Chinese government plans to halve tariffs on 1,717 goods it imports from the US. The tariff cuts cover $75 billion of the US goods coming into China. China's finance ministry said that the aim was ''to promote the healthy and stable development of Sino-US economic and trade relations''. However, experts are sure that China has to take this step as the country faces the fresh challenge of the coronavirus. As a result, tariffs on some goods would be cut to 5% from 10%, and on others from 5% to 2.5%. However, earlier, the Chinese authorities decided to cancel the previously imposed additional tariffs on goods from the US that could be used to fight the disease. Anyway, China is not ready to continue the trade war at the moment. However, the US has not benefited from the current situation to establish its supremacy. At the moment, both countries are stuck to the phase one deal.  At the same time, the US tariffs are still in effect and will be reviewed if China follows through with its part of the trade agreement. According to it, China promised to boost imported US goods by $200 billion compared to 2017. The list contains manufactured goods, agricultural commodities, and energy resources, including oil, natural gas, and coal. 

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