The US has also agreed to reduce tariffs on US$120 billion out of US$300 billion of Chinese goods affected since Sept. 1 from 15 percent to 7.5 percent. However, previously imposed tariffs of 25 percent on roughly US$250 billion of Chinese goods, such as machinery, electronics and furniture, remain in place. In exchange, China has committed to a minimum of US$200 billion in increased purchases of US products and services over the next two years, including US$32 billion in agricultural goods. At first glance, it looks as if the US would benefit from this deal, as existing tariffs with a big increase in Chinese purchases would help lower the trade deficit with China. However, compared with last year’s US$419.2 billion US-China trade deficit, the benefit is utterly inadequate.
