General

Recently, Tu Yonghong, deputy director of IMI and president of the Yangtze River Economic Belt Research Institute of Renmin University of China, published an article. In her article, she pointed out that trade is an indispensable and important driving force for economic growth. Maintaining normal Sino-US trade is conducive to optimizing resource allocation, improving total factor labor productivity and the real income level of residents.

Last year, the United States promulgated the Chip and Science Act and the Inflation Reduction Act, which aroused strong opposition from many countries, including the European Union. Recently, Li Chenggang, the Permanent Representative of China to the WTO, pointed out sharply that the United States is "the implementer of unilateral bullying, the destroyer of the multilateral trading system and the disrupter of the global industrial chain supply chain"; Pagan, the Deputy Permanent Representative of the United States to the WTO, criticized the WTO as "the shield of China's non-market policies and behaviors". The international community is worried that once the Sino-US trade friction intensifies, the stability of the global industrial chain will be further impacted, making the world economy in recession worse.

In an open economy, trade is an indispensable and important driving force for economic growth. Trade helps countries make full use of their own resource endowment advantages, participate in the international division of labor extensively, gain economies of scale and technology spillover effects, and accelerate the improvement of income levels and improve national welfare. Therefore, in the 1940s, when building a new international economic order after the end of World War II, the General Agreement on Tariffs and Trade (GATT was renamed WTO in the 1990s) with the purpose of promoting free trade became one of the three pillars of the international economic order. Economic globalization has pushed trade into a new stage of development. The international division of labor has shifted from product refinement to parts and components and production. The role of trade organizers and promoters of transnational corporations has become prominent. After China's entry into the WTO in 2001, European and American multinationals increased their investment in China under the attraction of cheap labor advantages and financial opening policies. China has rapidly developed into a world factory, and its importance in the global industrial chain supply chain has been increasing. Since the 18th CPC National Congress, under the guidance of the new development concept, China has comprehensively transformed its economic development model, strengthened innovation-driven and high-quality development, added new impetus to emerging industries and the digital economy, contributed 30% of the world's economic growth, and replaced the United States as the world's largest trading country. At the same time, China has accelerated the construction of a new pattern of development, optimized the trade structure, balanced the balance of payments, and reduced the external dependence of the economy. The proportion of the trade surplus in GDP has dropped from 10% in 2007 to about 2% in 2001. The independence and robustness of economic development have been further strengthened. In the face of great changes not seen in a century, the restructuring of the international trade pattern, especially the steady narrowing of the gap between the economic aggregate between China and the United States, the anxiety of the United States about being overtaken by China and losing its leading position is increasing. In addition to the largest source of Sino-US trade deficit, some politicians with ulterior motives always attack China and rob Americans of their jobs in order to win votes. Under the hegemonic logic of "giving priority to the United States" and containing China's development, in the past decade, the United States has been taking protectionist measures against China under various pretexts, and has expanded from products to technology, from unilateral sanctions to "friendly outsourcing", which has led to the escalation of Sino-US trade friction, and the trade between China and the United States has been significantly affected. The United States has dropped from China's largest trading partner to ASEAN and the European Union, China fell from the second largest trading partner of the United States to the third, behind Canada and Mexico.

China and the United States are the two largest economies in the world and are at different stages of development. The per capita GDP of the United States is more than $40000, while that of China is just over $10000; The U.S. economy is dominated by the service industry, which accounts for up to 80% of the economy, while China is the world's processing factory, and the service industry accounts for less than 60%. Although the political and economic systems of the two countries are different, their economies are highly complementary. For a long time, the economic and trade pattern of American consumption and services and Chinese manufacturing has been formed. This is the fundamental reason why the Sino-US trade is still reaching a record high of 760 billion US dollars in 2022, despite the intensification of trade frictions between the two countries.

Maintaining normal Sino-US trade is conducive to optimizing resource allocation, improving total factor labor productivity and the real income level of residents. The United States implements protectionism to safeguard the interests of specific groups and sacrifice the welfare of the whole people, which will inevitably lead to China's reciprocal counter-regulation and bring a wider range of economic losses. The result can only be a win-win situation. China and the United States have their own comparative advantages. The United States has a leading edge in the field of high-tech and modern service industries, and has a larger voice in international rulemaking. China has leading advantages in infrastructure, manufacturing and digital economy. The areas of economic complementarity between the two countries are far greater than those of direct competition, which objectively has a strong economic foundation for developing trade. China and the United States should increase high-level exchanges and fully understand and accommodate their respective interests and concerns; The United States should not generalize the concept of national security, arbitrarily sanction Chinese enterprises and deprive China of the opportunity to develop high technology; China and the United States should go in the opposite direction, seek the right way to get along, strengthen the coordination of macro policies, and gradually eliminate the mutual imposition of commodity tariffs; Encourage two-way direct investment and open up new tracks for climate change cooperation and more trade; Seek common ground while reserving differences, find a way to achieve "win-win", and jointly maintain the stability of the global industrial chain supply chain.