On Thursday night, the United States and China reached an agreement on a new trade deal. What exactly is in the agreement, how beneficial is it to the U.S., and how will it affect relations between the U.S. and China going forward?
Here are seven things you need to know about the new trade deal.
1. China promises to end its ban on U.S. beef imports. China’s ban was implemented in 2003 in response to the outbreak of mad cow disease at the time. In exchange for ending the ban, the U.S. will import cooked poultry from China.
However, it should be noted that China had previously promised to end its ban on U.S. beef imports in September, but they failed to follow through on their pledge. This time, China has a July 16 deadline to follow through on ending the ban.
2. China will allow foreign-owned financial services companies to offer operate in the country. According to CNBC, China had previously pledged to do this, but the deal now has a July 16 deadline in place to ensure that China sticks to its commitment. China allowing these firms into the country would “help those agencies expand their business and help improve risk assessment in China’s corporate debt market,” CNBC explains.
3. The U.S. will grant Chinese financial agencies access to its banking market. Secretary of Commerce Wilbur Ross told CNBC, “Clearly China, whose banks are among the largest in the whole world, wants access to the US banking market. As long as they can comply with the normal rules, they will get access.”
4. China will expedite the product applications of U.S. biotech companies. This would include companies like Monsanto attempting to get Chinese approval for their genetically modified seeds, but the deal doesn’t require China to approve of such products, only that they accelerate the application process.