BEIJING: There is a high likelihood that China and the US will post a bilateral trade record this year, experts said, as their industries and economies are closely intertwined and cannot be decoupled, despite ongoing geopolitical spats and some US politicians’ hue and cry intended to stem China’s rise.
The inseparable China-US economic relations are reflected in the two countries’ trade data. Although no moves have been taken yet to remove the trade-war tariffs, China-US bilateral trade started to take off around mid-2020 in the depths of the pandemic and has showed no signs of abating into 2021.
According to Chinese customs data released on Tuesday, China-US trade spiraled up by a striking 61.3 percent in yuan terms in the first quarter of this year to reach 1.08 trillion yuan ($165 billion). This growth outpaced all of China’s other major trading partners including Japan, the EU, and Association of Southeast Asian Nations (ASEAN) economies.
Although the growth has slowed a little bit from the two countries’ trade rise in the first two months of this year, it is still a “super strong” rise in the eyes of several Chinese economists, who stressed that it shows the tariffs imposed by the former Trump administration have had no great impact on China-US trade and supply chain cooperation.
The US’ trade deficit with China reached 472 billion yuan in the first quarter of 2021, further widening from the trade deficit of 334.4 billion yuan recorded in the first two months, according to Global Times’ calculations.
The widening data is in contrast with US ambitions to reduce the gap – one of the key motivations for former US president Donald Trump to launch the trade war against China. Most of the tariffs remain in place under the new Biden administration. “The data proves that politicians can’t break the economic laws,” He Weiwen, a former senior Chinese trade official, told the Global Times on Tuesday, stressing that the trade rise attests to the US’ reliance on China-made products – especially after exploring all around the world for substitutes over the past two years. The beyond-expectation export number indicates external demand is gradually recovering, while demonstrating manufacturing ability in the world’s major economies including the US are still recovering at a slow pace, thus orders are all flowing into China, Cao Heping, a professor of economics at Peking University in Beijing, told the Global Times on Tuesday.
Tian Yun, vice director of the Beijing Economic Operation Association, said the first-quarter rise in China-US trade is particularly impressive, because the trade boom in the first two months could be attributed in large part to a low statistical base last year due to the coronavirus shutdown, but the economic stand still started to improve in March 2020, meaning that this March’s growth was driven by a genuine demand surge.
Tian stressed that China’s robust trade situation gives the country more confidence and leeway to settle China-US trade disputes.
“China’s rising trade with ASEAN members and the EU can offset any losses from a decrease in trade with the US trade, and when China’s exports to the US are still robust despite a rising yuan and the US crackdown measures, the answer is cleaar as to which one of the two countries is more dependent upon the other,” he said.
China’s trade with the EU and ASEAN economies rose 36.4 percent and 26.1 percent in the first quarter. Currently, the US is China’s third-largest trading partner behind the EU and ASEAN.
– The Daily Mail-Global Times News exchange item
