WASHINGTON (Reuters) – Few U.S. companies doing business in China view President Donald Trump’s Phase 1 trade deal as being worth the cost of tariffs incurred over a two-year trade war, a new survey by the U.S.-China Business Council showed on Tuesday.

The trade group said that just 7% of respondents to its annual membership survey said that the benefits from the Phase 1 agreement outweigh the costs of tariffs incurred along the way. Some 36% of respondents said the costs outweighed the benefits and 56% said it was too soon to tell.

But the USCBC said 88% of respondents held a “positive” or somewhat positive overall view of the trade deal. Half of those responding positively said this was because the deal “makes the bilateral relationship more stable and decreases chances for further tariff escalation.”

The Phase 1 trade deal, activated on Feb. 15, calls for China to increase purchases of U.S. farm and manufactured products, energy and services by $200 billion over two years, along with increased U.S. access to China’s financial services markets, and some improvements in intellectual property protections. Promised negotiations on a Phase 2 agreement covering more difficult technology transfer issues, industrial subsidies and data restrictions have been shelved.

China is far behind the pace of purchases needed to meet its first-year purchase increase target of $77 billion.

Despite this shortfall and a rapidly deteriorating U.S.-China relationship amid issues from China’s security crackdown on Hong Kong to Trump’s threat to shut down Chinese-owned short video app TikTok, White House adviser Larry Kudlow said on Tuesday the Phase 1 trade deal is “fine right now.”

Top U.S. and Chinese officials are due to hold a videoconference on Saturday to assess the six-month implementation of the Phase 1 agreement.

Reporting by David Lawder; Editing by Steve Orlofsky

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Finding God online: People turn to live-streaming religious services during coronavirus pandemic

New York (CNN Business)In a typical year, Purim is a festive occasion. The Jewish holiday, which took place earlier this week, is marked by the reading of the Megillah, or the Book of Esther, during which children are encouraged to…

Volkswagen-SAIC JV to make Audi sedans

Volkswagen AG and its Chinese joint venture partner SAIC Motor plan to invest 4.13 billion yuan ($590 million) to revamp their car plants in Shanghai to make new Audi sedans, Reuters reported on Tuesday with sourcing from a government document.…

China’s auto sector shows gradual recovery from pandemic

As the novel coronavirus has been further contained in China, some automobile companies started to see improved sales growth in April. This, auto analysts believe, is an important signal that indicates auto companies are gradually recovering from the pandemic. On…

Citigroup launches new ESG investment banking group

NEW YORK (Reuters) – Citigroup Inc (C.N) said on Tuesday that is launching a new business unit within its corporate and investment bank dedicated to environmental sustainability to strengthen its commitment to an area that has grown increasingly important to…