Trade with the United States has shrunk sharply, and China has fallen out of the top three, but it h

Mondo Finance Updated on 2024-01-29

As you may have heard, in the first half of this year, there was a sharp decline in the amount of China and the United States, and China also fell from the position of the largest partner of the United States to the third place, surpassed by Canada and Mexico. Does this mean that there is a serious crisis in Sino-US economic and trade relations?

Is China's foreign trade prospect worrisome?Actually, it's not that simple. Behind the shrinkage of the Sino-US market, there is the optimization of China's foreign trade structure, the charm of the Chinese market, and the opportunity for the reversal of China's economy.

According to data from the General Administration of Customs of China, in the first five months, the total value of China and the United States was 189 trillion yuan, down 55%, far worse than China's foreign trade increased by 4 year-on-year in the same period7% overall performance. Among them, China's exports to the United States are 138 trillion yuan, down 8 percent year-on-year5%。This data is basically consistent with the statistics of the United States.

There are many reasons for the shrinkage of the Sino-US quota. First of all, political factors have caused obvious disruptions to Sino-US economic and trade relations. Since Trump launched the war, the economic and trade frictions between China and the United States have been escalating, and the two sides have imposed high tariffs on some goods, resulting in increased costs and suppressed scale.

Although Sino-US relations have eased somewhat after Biden took office, the United States has not canceled the tariffs imposed on China, nor has it relaxed the technological blockade and sanctions against China, and still tries to weaken China's position in the global chain with the strategy of "friendly shore, nearshore, instead of offshore".

Secondly, the adjustment of the global industrial division of labor has also affected the changes in the amount of China and the United States. Under the impact of the war, some U.S. companies have shifted orders to Mexico, Southeast Asia, South Asia and other places to avoid tariffs and risks and reduce dependence on China. At the same time, China is also actively promoting industrial transformation and upgrading, improving its ability to innovate independently, and reducing its import demand for the United States. These factors have led to the substitution effect of China and the United States, which limits the growth space of China and the United States.

Although the amount of China and the United States has shrunk, this does not mean that China's foreign trade has declined, on the contrary, the structure and quality of China's foreign trade have been optimized. On the one hand, the market diversification of China's foreign trade has increased. In the first five months, China's imports and exports to ASEAN increased by 99%, an increase of 51 for Russia9%, an increase of 36%。

ASEAN has also surpassed the European Union to become China's largest partner, followed by the European Union, the United States, and Japan.

Second, third, fourth. This shows that China's dependence on traditional export markets such as the United States and Europe is decreasing, the market structure is becoming more and more diversified, and China's foreign trade ability to resist risks is also increasing.

On the other hand, the product structure and quality of China's foreign trade have also improved. In the first five months, China's exports of mechanical and electrical products to the United States accounted for 474%, an increase of 03 percentage points, of which the export growth rate of electric manned vehicles, lithium batteries, solar cells and other "new three" exceeded 50%.

These products reflect China's innovation capabilities and competitive advantages in the high-tech field, and are also in line with the global trend of green development. At the same time, the proportion of traditional labor-intensive products such as textiles, clothing and footwear exported by China to the United States fell by 24 percentage points to 296%。This shows that China's foreign trade is shifting from low-end to high-end, from quantity to quality, and from scale to efficiency.

Although the amount of China and the United States has shrunk, it has also brought new opportunities for China's economy. On the one hand, China's economy has shown a strong ability to reverse growth on a global scale. In the first half of this year, China's GDP grew by 127%, which is much higher than the global average.

The recovery of China's economy is mainly due to the effective control of the domestic epidemic, the recovery of domestic consumption, investment, export and other demand, as well as the support of active fiscal and prudent monetary policy. The reversal of China's economic growth has not only provided an important impetus for the global economic recovery, but also created favorable conditions for the stability and development of China's foreign trade.

On the other hand, the potential and attractiveness of the Chinese market are also being unleashed and demonstrated. In the first half of this year, China's total import value increased by 259%, up to 85 trillion yuan, a record high. This shows that the demand in the Chinese market is strong, the purchasing power of Chinese consumers is strong, and the domestic demand of China's economy plays a significant role.

At the same time, China is also actively expanding opening up, reducing tariff and non-tariff barriers, optimizing the business environment, signing multilateral and bilateral agreements such as the Regional Comprehensive Economic Partnership Agreement and the China-EU Comprehensive Agreement on Investment, and promoting the development of new business forms and models such as free pilot zones, free ports, and cross-border e-commerce, providing more convenience and opportunities for foreign enterprises and goods to enter the Chinese market.

The United States has shrunk sharply, and China's ranking has fallen out of the top three, but it has ushered in a reversal opportunity. This is a phenomenon that is cause for concern, and it is also a phenomenon worth pondering. It reflects the complexity and variability of China-US economic and trade relations, as well as the resilience and vitality of China's foreign trade. It reflects the ability of China's economy to reverse growth, as well as the potential and attractiveness of the Chinese market. It affects the interests and relations between China and the United States, as well as the global economy and **.

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