Coronavirus Could Hinder Beijing's Ability To Fulfill Phase One Trade Deal

China's next dilemma will be fulfilling the phase one trade deal, which states they must buy $200 billion in additional products from the U.S. over two years on top of pre-trade war levels, reported the South China Morning Post (SCMP).

The outbreak of the deadly virus has dramatically slowed China's economy, with nearly 57 million people in 15 cities on lockdown for the next several weeks. Factories and transportation networks across much of the country are shut down, which means goods across domestic and international supply chains are not free-flowing in the country.

Cases of the deadly virus continue to exponentially rise, as government numbers on Tuesday night show more than 6,000 infected and 132 confirmed deaths. Comparing the deadly virus with the 2003 SARS outbreak – it's important to note that coronavirus has already surpassed the number of infected by SARS in a few weeks, compared to the nine-month ordeal almost two decades ago.

Traders who spoke with SCMP had their doubts that China could hit hard targets of an additional $32 billion agriculture and $52 billion energy pledge over the next two years, mostly because the demand for the goods has collapsed. Also, countries like Brazil and Argentina have eroded U.S. market share in China over the last year with cheaper products.

https://www.zerohedge.com/markets/coronavirus-could-hinder-beijings-ability-fulfill-phase-one-trade-deal