DAVID GREENE, HOST:
Well, a year and a half after launching his trade war against China, President Trump is set to sign a partial truce today. He's going to be joined by China's vice premier at a signing ceremony at the White House. Trump has agreed to relax some of those tariffs he imposed on Chinese imports in exchange for Beijing's agreement to buy more American products and also make some other changes. NPR's Scott Horsley has the details on this and joins us this morning. Hey there, Scott.
SCOTT HORSLEY, BYLINE: Good morning, David.
GREENE: OK. So important here - this deal is being called a phase one trade agreement, which I think suggests to all of us that this might not be the last word.
HORSLEY: That's right. It does not address some of the structural issues that the administration has complained about in China's economy. Those are left for phase two negotiations. But the administration says this deal does include some more safeguards for U.S. companies' intellectual property in China for their technological knowhow. In an interview with Fox News, Treasury Secretary Steven Mnuchin conceded that the deal doesn't get everything the administration wants, but he characterized this as a victory for President Trump.
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STEVEN MNUCHIN: This is really a historic transaction. Now, it's not everything, and, as we've said, there will be a phase two. But this is the first time we've had a comprehensive agreement with China. This is a big win for the president.
HORSLEY: And the administration also boasts that China is going to buy a lot more U.S. goods and services, some $200 billion in additional imports, over the next couple of years compared to what Beijing was buying back in 2017 before the trade war began.
GREENE: Can we focus on that $200 billion number? I mean, that would be a massive increase in U.S. exports going to China, like, more than 50%, right? I mean, is that realistic?
HORSLEY: It's certainly a stretch, and it would likely require China to shift some purchases away from other countries, which they might not be too happy about. China is expected to buy a lot more factory products under this deal, more energy from the United States, more American services and, of course, more agricultural products. You know, farmers took a big hit during the trade war when China dialed back its purchases of American commodities. Kristin Duncanson, who raises soybeans in south central Minnesota, told me her crop lost at least a third of its value when China took its business elsewhere. So she's really hoping for some rebound thanks to this phase one trade deal.
KRISTIN DUNCANSON: We're optimistic that signing the agreement will reopen some opportunities, especially for the upper Midwest. But I'm also a realist enough to know until those beans are actually shipped to customers that we can't count our chickens before they're hatched.
HORSLEY: I asked Duncanson if she's planning to plant more soybeans this spring in anticipation of bigger Chinese purchase orders. She told me she might shift some of her acreage in anticipation of that. But for the now, she's kind of in a wait-and-see mode.
GREENE: To see what the impact might be for her. The tariffs we've talked about - I mean, all the tariff threats, the tariffs going back and forth between the two countries, I mean, we should say a lot of Chinese goods are still going to be subject to import taxes here, right?
HORSLEY: That's right. Hundreds of billions of dollars in Chinese goods are still going to be hit with a 25% import tax. And that includes a lot of components that U.S. factories assemble into finished products. So that's been a challenge for the American manufacturing sector. Factories have been in a slump since August. Syracuse economist Mary Lovely said that despite this phase one agreement, there's just not a lot of tariff relief on the horizon.
MARY LOVELY: There's been a lot of hurt all across the economy, and I don't think we've gotten much out of this. And it's my personal hope that we turn back to working with allies to make the sort of slow but steady progress that we need to make to improve this relationship over the longer term.
HORSLEY: And there was a quick step in that direction when the U.S. announced a deal with Japan and the European Union to challenge some Chinese subsidies.
GREENE: NPR's Scott Horsley for us this morning. Scott, thanks.
HORSLEY: You're welcome.
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