Stable Economic Relationship in Interests of China and US

CGTN, March 4, 2017 | 作者: Gong Ting | 时间: 2017-03-06 | 责编: Wang Jiapei
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In his joint address to the US Congress on February 28, President Donald Trump emphasized that he believes strongly in free trade, but blamed his country’s trade deficit on unfair trade practices. Both NAFTA and China, in his speech, were taken as scapegoats for the loss of one quarter of US manufacturing jobs and 60,000 factories. 

Such rhetoric is no surprise at all, at the very time when anti-globalization sentiment, protectionism and isolationism dominates the mindsets of both American people and leadership. However, there is no denying the fact that the United States is one of the biggest beneficiaries of globalization. In the past several decades, multinational corporations, mostly from the United States, have been the engines of globalization, and therefore made extensive profits through superior and favorable positions in the global value chain, as well as through huge market shares of developing and emerging markets, including the market of China. 

In terms of so-called domestic problems brought by globalization and free trade, including but not limited to the widening gap between the rich and the poor, the loss of jobs and manufacturing industries, it is time the US reflects more on itself, especially the problem of imbalance in both its wealth distribution mechanism and its economic structures. 

Just as Charlene Barshefsky, the former US trade representative, said in New York on February 22, a trade war would not be constructive at all, and it is important to find the internal policy causes of these problems, including education, tax, and even legislation. 

The economic and trade relationship between China and United States is complementary and mutually beneficial in nature. US companies have made important contributions to China's employment, taxation and economy and at the same time China's trade and investment also bring great benefits to the US. 

The latest statistics from China’s Ministry of Commerce show that the US is China's largest export market and an important source of foreign investment. In 2016, total bilateral trade in services exceeded 100 billion US dollars, and accumulative investment between the two countries has been more than 170 billion US dollars. In trade, China is America’s fastest-growing export market besides the rest of North America and US exports to China have grown by 11 percent annually in the past decade. 

US statistics suggest US exports of goods and services to China in 2015 respectively created 600,000 and 31,000 jobs for America. Also, non-financial direct investment from Chinese enterprises to the US has exceeded 50 billion US dollars and created more than 100,000 jobs in America. A survey on Chinese business environment by US-China Business Council suggests that 90 percent of US enterprises in China made profits. 

US anti-dumping and anti-subsidy investigations on China have become more frequent in the past few months, and it is important for both sides to prevent trade frictions and disputes from evolving into a so-called trade war. A stable and mutually beneficial economic relationship is in the very interests of both countries. 

 

 

Gong Ting is Assistant Research Fellow of Department of American Studies, China Institute of International Studies (CIIS).

 

 

Source: CGTN, March 4, 2017.

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