US-China phase one tracker: China’s purchases of US goods

On February 14, 2020, the Economic and Trade Agreement Between the United States of America and the People's Republic of China: Phase One went into effect. Under the deal, China agreed to expand purchases of certain US goods and services by $200 billion for the two-year period from January 1, 2020, through December 31, 2021, above 2017 baseline levels.

In the end, China purchased only 58 percent of the total US goods and services exports over 2020-21 that it had committed to buy under the agreement. Put differently, China bought none of the additional $200 billion of US exports committed under the deal (figure 1). A more complete analysis of which US goods and services exports China did (and did not) purchase, as well as why, is found here.

Over the course of 2020-21, this PIIE Chart tracked China's monthly purchases of US goods only covered by the agreement. (Because services data were only available at a considerable time lag and not at the monthly frequency, they were not reported in these updates.) Following the text of the legal agreement, tracking goods purchases required relying on data from both Chinese customs (China's imports) and the US Census Bureau (US exports). The chart then compared those goods purchases with the legal agreement's annual commitments, prorated on a monthly basis based on seasonal adjustments, above two baseline scenarios (see methodology section IV below). As set out in the legal agreement, one 2017 baseline scenario allowed for use of US export statistics and the other allows for Chinese import statistics.

I. China's purchases of US goods, 2020-21

From January 1, 2020, to December 31, 2021, China committed to purchase no less than an additional $162.1 billion of covered goods from the United States relative to these 2017 baselines (figure 2). Defining the 2017 baseline using US export statistics implied a two-year purchase commitment of $352.2 billion. Defining the 2017 baseline using Chinese import statistics implied a two-year commitment of $380.5 billion.

From January 2020 through December 2021, China's total imports of covered products from the United States were $235.3 billion (figure 2, red in panel a) and US exports to China were $210.1 billion (blue in panel a). In the end, China's purchases of all covered products reached 62 percent (Chinese imports) or 60 percent (US exports) of the phase one commitment.

For covered agricultural products, China committed to an additional $32.0 billion of purchases combined over 2020 and 2021 above 2017 levels, implying a two-year commitment of $80.1 billion (Chinese imports, panel b) and $73.9 billion (US exports, panel c). From January 2020 through December 2021, China's imports of covered agricultural products from the United States were $61.4 billion and US exports were $61.1 billion. In the end, China's purchases of covered agricultural products reached 77 percent (Chinese imports) or 83 percent (US exports) of the phase one commitment.

For covered manufactured products, China committed to an additional $77.7 billion of purchases combined over 2020 and 2021 above 2017 levels, implying a two-year commitment of $234.4 billion (Chinese imports) and $210.7 billion (US exports). From January 2020 through December 2021, China's imports of covered manufactured products from the United States were $142.8 billion and US exports to China were $124.0 billion. In the end, China's purchases of covered manufactured products reached 61 percent (Chinese imports) or 59 percent (US exports) of the phase one commitment.

For covered energy products, China committed to an additional $52.4 billion of purchases combined over 2020 and 2021 above 2017 levels, implying a two-year commitment of $66.0 billion (Chinese imports) and $67.7 billion (US exports). From January 2020 through December 2021, China's imports of covered energy products from the United States were $31.1 billion and US exports to China were $25.0 billion. In the end, China's purchases of covered energy products reached 47 percent (Chinese imports) or 37 percent (US exports) of the phase one commitment.

For all uncovered products—making up 29 percent of China's total goods imports from the United States and 27 percent of US total goods exports to China in 2017—the phase one agreement did not include a legal commitment. From January 2020 through December 2021, China's imports of all uncovered products from the United States were $77.0 billion, 16 percent lower than in 2017 (taken twice). From January 2020 through December 2021, US exports of all uncovered products to China were $65.6 billion, 6 percent lower than in 2017 (taken twice).

II. China's purchases of US goods in 2021 in isolation

In 2021, China committed to purchase no less than an additional $98.2 billion of covered goods from the United States relative to these 2017 baselines (figure 3). Defining the 2017 baseline using US export statistics implied a 2021 purchase commitment of $193.3 billion. Defining the 2017 baseline using Chinese import statistics implied a 2021 commitment of $207.4 billion.

From January 2021 through December 2021, China's total imports of covered products from the United States were $135.5 billion (figure 3, red in panel a) and US exports to China were $116.1 billion (blue in panel a). In 2021, China's purchases of all covered products reached 65 percent (Chinese imports) or 60 percent (US exports) of the annual commitment.

For covered agricultural products, China committed to an additional $19.5 billion of purchases in 2021 above 2017 levels, implying an annual commitment of $43.6 billion (Chinese imports, panel b) and $40.4 billion (US exports, panel c). In 2021, China's imports of covered agricultural products from the United States were $37.8 billion and US exports to China were $33.8 billion. In 2021, China's purchases of covered agricultural products reached 87 percent (Chinese imports) or 84 percent (US exports) of the annual commitment.

For covered manufactured products, China committed to an additional $44.8 billion of purchases in 2021 above 2017 levels, implying an annual commitment of $123.1 billion (Chinese imports) and $111.3 billion (US exports). In 2021, China's imports of covered manufactured products from the United States were $76.3 billion and US exports to China were $67.0 billion. In 2021, China's purchases of covered manufactured products reached 62 percent (Chinese imports) or 60 percent (US exports) of the annual commitment.

For covered energy products, China committed to an additional $33.9 billion of purchases in 2021 above 2017 levels, implying an annual commitment of $40.7 billion (Chinese imports) and $41.6 billion (US exports). In 2021, China's imports of covered energy products from the United States were $21.3 billion and US exports to China were $15.2 billion. In 2021, China's purchases of covered energy products reached 52 percent (Chinese imports) or 37 percent (US exports) of the annual commitment.

For all uncovered products—making up 29 percent of China's total goods imports from the United States and 27 percent of US total goods exports to China in 2017—the phase one agreement did not include a legal commitment. In 2021, China's imports of all uncovered products from the United States were $42.0 billion, 8 percent lower than in 2017. Over the same period, US exports of all uncovered products to China were $35.0 billion, 1 percent higher than in 2017.

III. China's purchases of US goods in 2020 in isolation

From January 2020 to December 2020, China committed to purchase no less than an additional $63.9 billion of covered goods from the United States relative to the 2017 baselines (figure 4). Defining the 2017 baseline using Chinese import statistics implied a 2020 purchase commitment of $173.1 billion. Defining the 2017 baseline using US export statistics implied a 2020 commitment of $159.0 billion.

From January 2020 through December 2020, China's total imports of covered products from the United States were $99.9 billion (figure 4, red in panel a) and US exports to China were $94.0 billion (blue in panel a). In the first year of the agreement, China's purchases of all covered products reached 59 percent (US exports) or 58 percent (Chinese imports) of the annual commitment.

For covered agricultural products, China committed to an additional $12.5 billion of purchases in 2020 above 2017 levels, implying an annual commitment of $36.6 billion (Chinese imports, panel b) and $33.4 billion (US exports, panel c). In 2020, China's imports of covered agricultural products were $23.6 billion and US exports to China were $27.3 billion. In the first year of the agreement, China's purchases of covered agricultural products reached 82 percent (US exports) or 64 percent (Chinese imports) of the annual commitment.

For covered manufactured products, China committed to an additional $32.9 billion of purchases in 2020 above 2017 levels, implying an annual commitment of $111.2 billion (Chinese imports) and $99.4 billion (US exports). In 2020, China's imports of covered manufactured products were $66.5 billion and US exports to China were $57.0 billion. In the first year of the agreement, China's purchases of covered manufactured products reached 57 percent (US exports) or 60 percent (Chinese imports) of the annual commitment.

For covered energy products, China committed to an additional $18.5 billion of purchases in 2020 above 2017 levels, implying an annual commitment of $25.3 billion (Chinese imports) and $26.2 billion (US exports). In 2020, China's imports of covered energy products were $9.8 billion and US exports to China were $9.7 billion. In the first year of the agreement, China's purchases of covered energy products reached 37 percent (US exports) or 39 percent (Chinese imports) of the annual commitment.

For all uncovered products—making up 29 percent of China's total goods imports from the United States and 27 percent of US total goods exports to China in 2017—the phase one agreement did not include a legal commitment. In 2020, China's imports of all uncovered products from the United States were $35.0 billion, 23.3 percent lower than in 2017. Over the same period, US exports of all uncovered products to China were $30.7 billion, 11.7 percent lower than in 2017.

IV. Methodological Approach

Assessing China's progress toward meeting the phase one purchase commitments for goods trade required information from both US export statistics and Chinese import statistics, given that the agreement's Chapter 6, Article 6.2.6 states "Official Chinese trade data and official US trade data shall be used to determine whether this Chapter has been implemented." One implication was that there were two sets of monthly data to track (Chinese imports and US exports). A second was that there are two different annual, and hence monthly, targets, since the 2017 baseline level of Chinese imports differs from the 2017 baseline level of US exports. Finally, the products covered by the purchase commitments were set out at the 4-, 6-, 8-, or 10-digit level in the agreement's Attachment to Annex 6.1; these were then mapped to the US or Chinese trade statistics for 2017 and for 2020 and 2021. Starting with our update of this PIIE Chart on October 26, 2020, we included US export product 8800 (in addition to 8802, aircraft) in "covered manufacturing" and the total, shifting it out of the "uncovered" category.

Each month's purchase target was seasonally adjusted to reflect that month's relative weight for those products in the 2017 trade data. Note that prorating the year-end commitment to a monthly target was for illustrative purposes only. Nothing in the text of the agreement indicated China was required to meet anything other than the year-end commitments.

For US goods exports, the agreement was estimated to cover products that made up $95.1 billion, or 73 percent, of total US goods exports to China ($129.8 billion) in 2017. Of the 2017 total exports of covered products, exports worth $20.9 billion were in agriculture, $66.5 billion were in manufacturing, and $7.6 billion were in energy. Products uncovered by the agreement—and thus with no commitments for 2020 or 2021—made up 27 percent ($34.7 billion) of total US goods exports to China in 2017.

For Chinese goods imports, the deal was estimated to cover products that made up $109.2 billion, or 71 percent, of total Chinese goods imports from the United States ($154.9 billion) in 2017. Of the 2017 total imports of covered products, imports worth $24.1 billion were in agriculture, $78.3 billion were in manufacturing, and $6.8 billion were in energy. Uncovered products made up 29 percent ($45.6 billion) of total Chinese goods imports from the United States in 2017.

For both the US export data and the Chinese import data, the 2020 phase one commitments of additional trade (on top of 2017 baseline) were $12.5 billion (agriculture), $32.9 billion (manufactured goods), and $18.5 billion (energy). The 2021 phase one commitments of additional trade (on top of 2017 baseline) were $19.5 billion (agriculture), $44.8 billion (manufactured goods), and $33.9 billion (energy). These commitments are listed in the agreement's Annex 6.1.