‘Economic Misalignment’ With China Is Focus of US Trade Czar

(Bloomberg) — The top US trade official is more focused on the distortions to the American economy caused by China’s nonmarket policies than certain violations of a trade agreement between the two countries. 

“Distortions from the Chinese market are systemic,” US Trade Representative Katherine Tai said Thursday in Denver. “I think of the Phase 1 agreement as one particular structure that was an agreement that was struck by the Trump Administration a couple of years ago.”

U.S. Trade Representative Katherine Tai Interview

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U.S. Trade Representative Katherine Tai Interview

“I am much more interested in the overall economic misalignment, if you will, between our two economies and the need for us to figure out how to level that playing field,” Tai said. 


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After a two-year tariff war, Washington and Beijing in early 2020 reached the so-called Phase 1 agreement, with the US reducing some duties in exchange for China pledging to address intellectual-property theft and buy $200 billion in energy, farm and manufactured goods along with services through December 2021. 

However, China fell more than one third short of those promises and the USTR last year began a review of certain tariffs on China, which would have started to automatically expire in the middle of last year absent an evaluation of their impact.

Tai didn’t say if she was considering a tariff hike in response to Beijing failing to honor its commitments made in the Phase 1 agreement. She said she’s focused on correcting distortions on the US market “that have come from the non-market policies and practices from China.” 

Tai said she was intent on finding a way for China and the US to coexist as the the world goes through a “very disrupted phase.”

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