How Will the Coronavirus Affect the Chinese and US Trade Agreement
Director of the National Economic Council Larry Kudlow is expecting only short term issues due to the coronavirus regarding the boost that was expected when China and the US signed a deal in January that would have China buying $200 billion of US goods over the next two years.
“The export boom from that trade deal will take longer because of the Chinese virus,” said Mr. Kudlow during a Fox Business Network interview.
Even though China’s economy is slowing down, partially due to the virus effecting the labor force and consumers, the US officials do not think that there will be any real long term effects after the virus has been stopped.
“I think it’s going to be much tougher for China,” Kudlow said. “The world hasn’t stopped. We’re a very vibrant economy in the U.S.A. And, incidentally, this may spur some business investment in equipment and inventories.”
This deal is supposed to increase purchase of manufactured goods by $77.7 billion, the tech services industry is projected to grow by 37.9 billion and energy purchases will go up by $52.4 billion
China also promises to continue helping the US dairy farmers, but the slow down may spur buying after the virus is controlled. “It’s very possible China gets over this by the late spring and will use a lot of their monetary easing to try to jump-start the economy to make up for the losses in the first quarter.” Said Ann Lee