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China’s import demand for agricultural products: The impact of the Phase One trade agreement

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  • Robert Feenstra
  • Chang Hong

Abstract

In December 2019, China committed to purchase more imports from the United States under a Phase One trade agreement. We show that the most efficient way for China to increase its agricultural imports from the United States is to mimic the effect of an import subsidy, which would need to be 42% and 59%, respectively, to meet the 2020 and 2021 targets in the absence of other growth from 2017. As a result, China would divert agricultural imports away from other countries, especially from Australia and Canada, followed by Brazil, Indonesia, Malaysia, Thailand, and Vietnam.

Suggested Citation

  • Robert Feenstra & Chang Hong, 2022. "China’s import demand for agricultural products: The impact of the Phase One trade agreement," Review of International Economics, Wiley Blackwell, vol. 30(1), pages 345-368, February.
    • Handle: RePEc:bla:reviec:v:30:y:2022:i:1:p:345-368
    DOI: 10.1111/roie.12568
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    Cited by:

    1. Ma, Hong & Ning, Jingxin & Xu, Mingzhi (Jimmy), 2021. "An eye for an eye? The trade and price effects of China's retaliatory tariffs on U.S. exports," China Economic Review, Elsevier, vol. 69(C).
    2. John C. Beghin & Heidi Schweizer, 2021. "Agricultural Trade Costs," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(2), pages 500-530, June.
    3. Liu, Nan, 2020. "Trade war from the Chinese trenches," MPRA Paper 103929, University Library of Munich, Germany.
    4. Jason H. Grant & Kathryn A. Boys & Chaoping Xie, 2021. "A new president in the White House: implications for Canadian agricultural trade," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(1), pages 45-58, March.
    5. Andrew Muhammad & Stephen A. Smith & Jason H. Grant, 2022. "Can China meet its purchase obligations under the Phase One Trade Agreement?," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(3), pages 1393-1408, September.
    6. Munisamy Gopinath, 2021. "Does Trade Policy Uncertainty Affect Agriculture?," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(2), pages 604-618, June.
    7. Lavoie, Nathalie & Joseph, Siny, 2020. "Trade War and Incomplete Labeling Regulation: Lose-Lose Situation for U.S. Consumers," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304645, Agricultural and Applied Economics Association.
    8. Liu, Nan, 2020. "Trade war from the Chinese trenches," MPRA Paper 110175, University Library of Munich, Germany.

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    More about this item

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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