China defends US 'Phase One' trade deal shortfall

The comments came as US figures released Tuesday showed the trade deficit with China ballooning by $6 billion to $34.1 billion in December 2021.

After a long-running standoff, the two countries reached a so-called "phase one" agreement in January 2020, in which Beijing pledged to increase its purchases of American products and services by at least $200 billion through 2020 and 2021.

The deal followed a long-running trade war that saw then-President Donald Trump and China's Xi Jinping impose punitive tariffs on hundreds of billions of dollars worth of goods, dealing a severe blow to relations.

Washington has complained that Beijing is not holding up its side of the agreement, with Tuesday's Commerce Department figures laying bare the yawning deficit.

On the same day the Peterson Institute for International Economics, a Washington-based thinktank, said China was "never on pace to meet its purchase commitments".

But China's commerce ministry on Wednesday argued Beijing had "promoted the joint implementation of the agreement".

"Since the agreement came into effect, China has worked hard to overcome the multiple adverse effects caused by the pandemic, global economic slowdown and supply chain disruptions," commerce ministry spokesman Gao Feng told reporters on Wednesday.

Gao said China hoped the US would "cancel its suppressive measures of additional tariffs and sacnctions against China as soon as possible", to "create a favourable atmosphere" for trade.

Relations between the two nations deteriorated under Trump, who imposed tariffs on $370 billion worth of Chinese products in 2018, citing trade practices Washington deemed "unfair" and slamming the huge trade deficit.

But many US companies have criticised the levies, saying they drove up costs, since importers bear the brunt.

In early October, US Trade Ambassador Katherine Tai said President Joe Biden would keep the punitive duties in place.

A month later she said she was "optimistic" about discussions with China, but remained noncommittal about what actions Washington might take if Beijing failed to live up to its commitments.