General

According to data from the General Administration of Customs of China, the total trade value between China and the United States in the first five months was 1.89 trillion yuan (RMB, the same below), a year-on-year decrease of 5.5%, far inferior to the overall performance of China's 4.7% year-on-year growth in foreign trade during the same period. Among them, China's exports to the United States reached 1.38 trillion yuan, a year-on-year decrease of 8.5%.

The shrinking trade volume between China and the United States is due to various reasons. Zhang Xiaotao, Dean of the School of International Economics and Trade of the Central University of Finance and Economics, said in an interview that, in addition to the obvious interference of political factors on Sino US economic and trade relations, the recovery of the world economy is unstable, and enterprises have unclear expectations for the future; The transfer of some orders from the United States to Mexico, Southeast Asia, South Asia, and other regions has also affected the scale of Sino US trade to some extent.

In Zhang Xiaotao's view, the current decline in trade volume between China and the United States, especially the decline in China's exports to the United States, is a normal phenomenon that has emerged in the context of the adjustment of global industrial division of labor and the acceleration of regional economic integration. This indicates that China's dependence on traditional export markets such as the United States and Europe is decreasing, and the market pattern is becoming increasingly diverse, which does not mean that the economic and trade relationship between China and the United States is "decoupling".

Recently, Tesla CEO Musk and other executives from multiple US companies have visited China intensively, indicating that the decoupling of China US economic and trade is a false proposition.

In the words of Gresse, the former chief economist of the United States Trade Representative Office, although the US tariff policy on China has an impact on bilateral trade, the behavior of consumers and enterprises is more influential than political decision-making.

Hua Ganglin, chairman of the American Chamber of Commerce in the People's Republic of China, also disclosed earlier that China is "always a very important investment destination" for American enterprises. American enterprises are still increasing their investment in China. "Most enterprises do not transfer their supply chains".

However, some analysts also remind that although the shrinking trade volume between China and the United States does not mean that the two countries' economy and trade are "decoupled", some deep-seated issues behind it cannot be ignored.

Cui Xiaomin, an associate researcher at the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, wrote that in 2022, bilateral trade between China and the United States steadily recovered, mainly driven by strong domestic demand and price factors in the United States. Last year, members of the North American Free Trade Area, ASEAN, EU and other trading partners significantly increased their exports to the United States, with a faster growth rate than China's exports to the United States.

Cui Xiaomin stated that China's share in the total trade of goods in the United States decreased from 14.8% in 2020 to 12.9% in 2022, while the shares of Canada and Mexico steadily increased during the same period, with Canada increasing from 13.9% to 14.8%. On the import side of the United States, China's share is also decreasing, accounting for 16.4% in 2022, a decrease of 5 percentage points from 21.4% in 2017. This to some extent reflects the decline in the relative competitiveness of Chinese products in the United States.

It is worth noting that Chinese foreign trade enterprises are actively promoting product transformation and upgrading. The "new three types" of electric manned vehicles, lithium batteries, and solar cells are becoming important support for China's exports.

Zhang Xiaotao believes that in addition to strengthening market development and product research and development by enterprises, China should also continue to improve its business environment, strive for all possible cooperation opportunities, and buy time and space for the transformation and upgrading of domestic industries. In the long run, the prospects for Sino US trade can still be cautiously optimistic. (Translated from: China News Network)