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China to grant regular tariff waivers for US farm imports
[BEIJING] China will provide retaliatory tariff waivers to buyers of US farm products on a more regular basis after the countries reached a phase one trade deal, according to people familiar with the situation.
Waivers had previously been given in tranches but they'll now be handed out more frequently, said the people, who asked not to be identified as the matter is private. The move will make it less punitive for Chinese companies to purchase US goods that are still subject to retaliatory trade tariffs and thereby help Beijing meet any commitments it has made as part of a trade deal.
While Beijing has an interest in keeping its side of any pact to hasten the end of its trade war with the world's biggest economy, China also needs to import agricultural products from overseas in order to feed its 1.4 billion people. This has become particularly critical in the past year as African swine fever destroyed swathes of the country's pig population.
US trade representative Robert Lighthizer has said Beijing made detailed pledges on agriculture that would see it purchase at least an additional US$16 billion annually in commodities on top of the pre-trade war level of US$24 billion and endeavor to buy as much as US$50 billion annually. But detailed targets on each commodity won't be made public, he said.
China's Ministry of Finance said on Sunday that the country will maintain its retaliatory tariffs on American soybeans, pork and other farm products after the trade deal, but continue to process waivers. The world's largest soybean importer has been issuing tariff exemptions in tranches to buy the oilseed it needs to produce cooking oil and animal feed. The Finance Ministry didn't immediately respond to a fax on Tuesday, seeking comment on the move to more regular tariff waivers.
Mr Lighthizer said he expects the 86-page trade agreement to be signed by him and his counterpart, Vice Premier Liu He, in early January in Washington and released publicly then. Lawyers for both sides will review the accord before signature, and Lighthizer sees it coming into effect 30 days after signing.
In efforts to ease fears of other countries that supply farm commodities to China, Ning Jizhe, vice chairman of the National Development and Reform Commission, has stressed increased agricultural purchases would comply with World Trade Organization rules. "Expanding China-US trade will not affect interests of other trading partners," he said. Brazil's shipments of soybeans to China have surged since the trade war started.