3 Sectors That Could Profit From a U.S.-China Trade Deal

In mid-October, President Donald Trump announced what he called a “very substantial phase one deal” in a possible U.S.-China trade accord that saw the continued delay of a proposed hike in U.S. tariffs.

The final details are still being worked out, but…

this initial agreement, which covers areas including intellectual property protections, financial services, foreign exchange markets, and agriculture, led to hope that the long-simmering trade war might soon be eventually resolved.

If a more comprehensive trade agreement is reached, certain sectors could see a big boost.

Resolving long-standing trade disputes

Trade tensions with China have simmered for decades. In 1980, China was granted provisional Most Favored Nation (MFS) status by the United States, which gave it access to U.S. markets with low tariffs. However, this status triggered congressional opposition due to evidence of China’s intellectual property theft, human rights abuses, and currency manipulations.

However, in 2000, Congress made China’s trading status permanent, paving the way for the Communist nation to join the World Trade Organization (WTO). The granting of permanent trading relations with China contributed to the capitalist boom in China that has continued to this day. Foreign investment poured in. Yet throughout the 2000s, both the European Union and the United States accused China of unfair business practices even as foreign companies flocked there to take advantage of China’s low labor costs.

The U.S.-China trade deficit on goods soared from…

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