It isn’t clear how these deals will have an economic impact given the fact that despite a 2012 WTO ruling, China has yet to issue operating licenses to Visa & MasterCard to operate in China.
On Thursday, U.S Commerce Secretary Wilbur Ross has disclosed that the United States and China will expand trade ties as well as increase access to each other’s financial firms as part of strategy to shrink the sizeable trade deficit the country has with Beijing.
The deal is the first tangible result of trade talks that began last month when U.S. President Donald Trump met Chinese President Xi Jinping in Florida to discuss ways for cooperation between the world’s two largest economies.
As part of the agreement, China will allow U.S. imports of beef, no later than July 16, while the United States will issue a proposed rule aimed at allowing the entry of Chinese cooked poultry into the country, said Ross at a briefing.
Further, Beijing will also allow U.S. card payment services to operate in its sector, which so far has been dominated by its UnionPay system with a near monopoly. Similarly China will also be able to provide credit rating services.
“This will help us to bring down the deficit for sure,” Ross said. “You watch and you’ll see.”
Ross said, the deal will impact China’s trade surplus with the United States by the end of 2017.
The U.S. is also eager to expand the export of its liquefied natural gas (LNG), saying it is open to negotiating any type of contract, including long term ones, with China.
Incidentally, it is unclear as to how these deals will boost trade between the two countries.
U.S.-owned credit card operators MasterCard Inc and Visa Inc have yet to receive independent licenses in China, despite a 2012 WTO ruling mandating that Beijing open the sector.