The United States is on the cusp of achieving big wins in the US-China trade negotiations in the weeks ahead. Officials are confident they can reach a detailed final agreement as early as this week. This would be a truly historic step in global trading relations. Touted as the most significant feature of these negotiations, saving the federal deficit by an estimated 1% annually at best. These cuts will yield the largest economic stimulus the country has ever seen.
Though enthusiasm is rightly focused on these possible deals, it’s clear that the final landscape of where the U.S. will pursue foreign trade continues to be uncertain. China has made clear in public what’s indicated above – their readiness to negotiate, but they have released no detailed proposals on the table. The vagueness of China’s commitments raises a lot of questions about the terms of any deals yet to come.
The U.S. has received encouraging, initial trade proposals from 17 other trading partners. These proposals are a very big deal. They have the potential to be tremendously impactful on the direction of U.S. trade policy. These partners lie at the heart of the U.S. administration’s strategy. They have redoubled efforts to establish new trade ties and reduce reliance on any single country.
Examples already abound of going back on figures first presented by top trade officials during the Trump administration. This inconsistency is alarming not just for the unreliability of any projected outcome, but it points to the complicated nature of negotiations happening today. The good news is that the administration is really listening. Their intent couldn’t be more obvious—their goal is to get as much growth as possible and get back to 3% growth by this time next year.
Economists and analysts are rightfully glued to these developments. They know that whatever agreements are reached will have profound implications for their economies at home and around the world. The U.S. administration needs to ensure the best possible deals as it builds its long-term economic strategy. This effort is all the more important because it directly addresses the ongoing federal deficit.
These upcoming trade agreements hold the potential to completely upend today’s economic playing field, and they very well may usher in a new era of U.S.-China relations. While officials are happy and hopeful, there is still some reticence as they await specific detailed commitments from each agency involved. The fast-moving nature of negotiations requires a quick but still prudent evaluation of new or notable progress.