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The US–China trade war and phase one agreement

Author

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  • Chad P. Bown

    (Peterson Institute for International Economics)

Abstract

The Trump administration changed US trade policy toward China in ways that will take years for researchers to sort out. This paper makes four specific contributions to that research agenda. First, it carefully marks the timing, definitions, and scale of the products subject to the tariff changes affecting US-China trade from January 20, 2017 through January 20, 2021. One result is that each country increased its average duty on imports from the other to rates of roughly 20 percent, with the new tariffs and counter-tariffs covering more than 50 percent of bilateral trade. Second, the paper highlights two additional channels through which bilateral tariffs changed during this period: product exclusions from tariffs and trade remedy policies of antidumping and countervailing duties. These two channels have received less research attention. Third, it explores why China fell more than 40 percent short of meeting the goods purchase commitments set out for 2020, the first year of the phase one agreement. Finally, the paper considers additional trade policy actions—involving forced labor, export controls for reasons of national security or human rights, and reclassification of trade with Hong Kong—likely to affect US-China trade beyond the Trump administration.

Suggested Citation

  • Chad P. Bown, 2021. "The US–China trade war and phase one agreement," Working Paper Series WP21-2, Peterson Institute for International Economics.
  • Handle: RePEc:iie:wpaper:wp21-2
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    File URL: https://www.piie.com/publications/working-papers/us-china-trade-war-and-phase-one-agreement
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    More about this item

    Keywords

    US-China trade policy; tariffs; trade war timeline; phase one agreement; antidumping; countervailing duties; product exclusions; export controls;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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