Chinau. S. Trade Friction Facts On September 24, China published a white paper, The Facts and China’s Position on Chinau. S. Trade Friction, to clarify bilateral economic and trade relations, demonstrate its stance on the two countries’ trade friction a
Economic cooperation between the two countries is so huge, substantive and broad-based, with so many players, that it is inevitable for some differences and friction to emerge. The two countries need to take a comprehensive perspective, keep in mind their strategic interests and the international order, properly handle their differences by seeking common ground while shelving differences, and take practical steps to resolve their tensions.
The gap in trade in goods alone is not a good indicator of China-u.s. trade and economic cooperation.
An objective assessment of the China-u.s. trade balance calls for a comprehensive and in-depth study, rather than a glance at the trade deficit in goods. It is not China’s intention to have a trade surplus. Rather, the ratio of China’s current account surplus to its GDP has declined from 11.3 percent in 2007 to 1.3 percent in 2017. The imbalance of trade in goods between China and the United States is more of a natural outcome of voluntary choices the United States has made in its economic structure and market in light of its comparative strengths. To resolve this issue, both sides need to make concerted efforts in restructuring. The United States turns a blind eye to various factors in its trade and economic cooperation with China, singles out the imbalance of trade in goods and blames China for the imbalance, which is unfair and unreasonable.
In today’s world of greater globalization and widespread international production, bilateral trade and economic cooperation already extend beyond trade in goods. Trade in services and sales of local subsidiaries in the host country should also be included. If we give full consideration to these three factors—trade in goods, trade in services and sales of local subsidiaries in the host country—trade and economic cooperation deliver balanced benefits in general for China and the United States, with the latter reaping more net benefits.
The gap in China-u.s. trade in goods is a natural outcome of the U.S. economic structure and a result of the two countries’ comparative strengths and the international division of labor. The persistent and growing gap in trade in goods between the two countries is a result of a number of factors, rather than China’s intent.
If we give full consideration to these three factors—trade in goods, trade in services and sales of local subsidiaries in the host country—trade and economic cooperation deliver balanced benefits in general for China and the United States, with the latter reaping more net benefits
The discussion of fair trade should not be detached from the principle of the mutual benefit of the World Trade Organization (WTO).
The WTO principle of reciprocity takes into consideration different development stages by granting special, differential and more favorable treatment to developing members. This ar-