Asia Minute: Region Reacts to U.S. China Trade Deal

Jan 17, 2020

A trade deal signed this week by the United States and China has been the focus of a lot of media coverage. Most stories in the United States emphasize the purchases of U.S. agricultural and other products that China will make. But in the Asia Pacific, there’s a slightly different tone.

“Cautious optimism” is a phrase you hear a lot in diplomatic circles. But China’s reaction to this week’s trade deal with the United States has been heavier on the side of caution. The Communist Party’s China Daily said the “elation” at reaching the deal was “quickly tempered by suspicions that it would not take much” to upset the agreement.

The Global Times is an offshoot of the Communist Party’s Peoples’ Daily — and wrote that “huge uncertainty” remains about the next phase of the deal. Although, it also said, “we hope the preliminary agreement will enlighten both sides’ further efforts.”

Elsewhere, Singapore’s Straits Times mentioned the symbolism of President Xi Jinping not showing up for the signing — but said the deal represents a “truce” in a trade war that “has put a dent in the global economy.”

Regional financial markets reacted less with enthusiasm and more with relief that the signing was not derailed by last minute rhetoric on either side.

The basic outlines of the deal have been priced into the markets for weeks.

In Australia, reaction was colored by domestic concerns: the idea that China buying more from American farmers means they may buy less from Australian farmers.

As for the next phase, much work ahead in the view of China’s state broadcaster, who said, “the more problems are resolved, the more intense the game becomes.”