The Case for Healthy U.S.-China Agricultural Trade Relations despite Deglobalization Pressures
October 2020 [20-WP 611]
The COVID-19 pandemic is crippling the global economy and heightening distrust and political disagreements among major countries. Furthermore, ongoing deglobalization efforts taken by firms and countries are fueling the rise of economic nationalism. A prime example is the possible decoupling of U.S.-China economic and trade relations, which the ongoing trade war has already significantly disrupted. This paper analyzes the impacts of COVID-19 on U.S. agricultural exports to China, especially the added delays and uncertainty on China's food imports meeting the U.S.-China phase one trade deal target. I present the views of U.S. farmers and the general public toward China and argue that healthy U.S.-China agricultural trade relations are not only critical for both countries but welcomed by U.S. farmers. I also discuss the possible rise in non-tariff barriers following the pandemic as well as trade policies that are increasingly intertwined with political tensions. Finally, I discuss how the U.S.-China phase one trade deal could possibly lead to a more balanced bilateral agricultural trade portfolio with greater share of protein and retail food products.
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