It is not peace, it is only a truce. The "phase 1 pact" agreed on Wednesday by the US and China to avoid the continuation of the tariff war is great news for the electoral expectations of Donald Trump , which is being re-elected this November, but it does not even imply The end of the confrontation.
In large lines, China is committed to increasing its purchases of US products by 200,000 million over the next two years. That means reducing the trade deficit of about 350,000 million that the US maintains with China by just under a third. The list of the supermarket that has been negotiated includes the increase in purchases of manufacturing, energy and agricultural products. The latter are very interested in Trump because in the agricultural states there are some of his most loyal fans. In a way, Beijing has agreed to commit 200,000 million to Trump's election campaign.
Although there have been advances in the critical issue of forced technology transfers of US companies operating with China, the problem of the "phase 1 pact" is all that has been left out, especially Chinese subsidies to state-owned enterprises, the issue of intellectual property and that of cybersecurity, not to mention cyber espionage. At the intersection of these coordinates are companies like Huawei, against which the US president has shown an unprecedented hardness.
For its part, the US has pledged to reduce the tariff to Chinese products in half worth 120,000 million dollars and will not increase the tariff on other products worth 156,000 million that was scheduled for Sunday. But the most renowned measure is the withdrawal by the Treasury Department of China's qualification as a "currency manipulator" country that occurred in August. This sanction was the last of the escalation of tensions, but it had a catch: the devaluation of the Chinese currency was the result of the same commercial war and the International Monetary Fund (IMF) endorsed China in this thesis.
I lost a bet on the commercial war with a Chilean economist who predicted to me almost a year ago that just the impeachment against Trump was approved, the commercial tension would cease. He hit right. It is true that the American president has screwed the Iranian Ayatollahs, ordering the murder of General Soleimani , but has begun to close other fronts, aware that you cannot fight successfully at all simultaneously.
This does not mean that free trade supporters can launch the bells on the fly. With this truce, Trump achieves his goal for China to recognize and pay its vassalage to what is the first economic and military power on the planet. It is not the triumph of a multilateral trading model like the one that - in a certain way imperfectly - had driven the globalization of the last 30 years, but the triumph of a bilateral model between a great lord and the closest thing to a subject who knows that Your time has not yet come.
In that sense, this pact is a Trump triumph that has managed to impose its vision of the world and created a powerful incentive to continue reviewing and agreeing bilateral treaties that consolidate an unprecedented imperial order. firstname.lastname@example.org
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