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China Trade Deal: Commerce Secretary Ross Breaks Down What to Know

20 May 2017

China has agreed to open up its markets to US financial firms and agriculture exports as part of a new bilateral trade agreement, in a decision the Trump administration called a "herculean accomplishment".

Some analysts, however, question how quickly U.S companies will feel the benefits in China, where foreign companies have long reported difficulty penetrating the domestic market. He said a similar deal for coal exports to China wasn't likely, given the far shipping distances.

Trump had pledged during his presidential campaign that he would stop trade practices by China and other countries that he deemed unfair to the US.

Although Mr Trump and his aides still complain regularly about the more than $300bn USA trade deficit with China the new United States president has begun to express a greater appreciation for the complexities of geopolitics. Gary Cohn, director of the National Economic Council, has voiced support for an LNG terminal in the U.S. Northwest that would ship gas to Asia. The latest agreement also includes their preparations to open up U.S. exports of liquefied natural gas to China.

In exchange, the USA would allow the sale of cooked Chinese poultry - a move Ross said could be done safely. It wasn't until last month at a Mar-a-Lago, Fla., meeting to advance U.S.

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Though a decent start, it won't do much to reduce Uncle Sam's trade deficit with China, which stood at almost $350 billion in 2016 - and which widened in March.

"While this deal is promising, China has made similar commitments before and has failed to follow through", Sen.

Beijing will also allow USA -owned card payment services to begin the licensing process in a sector where China's UnionPay system has had a near monopoly.

A decision by China to lift the beef embargo on the USA has a Kentucky cattle group optimistic.

"The plan gives a timeline for access set at no later than July 16, 2017". Those projects need to secure long-term supply agreements to underpin their financing before construction can begin. China will issue both bond underwriting and settlement licenses to two qualified USA financial institutions as well.

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By no later than 16 July, American beef producers will have full access to export to the Chinese marketplace of 1.4 billion people; both countries will also work together to allow imports of cooked Chinese chicken.

China's appetite for beef has increased massively in recent years, with its imports increasing from 860,000 tonnes in 2012 to an estimated 950,000 tonnes this year, making it one of the top buyers of the commodity, according to the US Department of Agriculture.

Last fall, the Obama administration secured preliminary access to the Chinese market for USA beef exports, which had been disrupted for more than a decade because of the "mad cow" scare, but hadn't finished the technical trade talks.

"The administration has shown great leadership in working with the Chinese government and industry to help finalize market access for USA beef", NAMI President and CEO Barry Carpenter said. "China is the second-largest beef importer in the world, buying roughly $2.6 billion of beef every year".

Though the Commerce Department said U.S.

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China Trade Deal: Commerce Secretary Ross Breaks Down What to Know