Developing Sino-US economic and trade relations serves the fundamental
interests of both peoples. Following the establishment of diplo"imatic
relations between the People's Republic of China and the United States,
bilateral economic and trade ties have grown fast, featuring complement
and mutual benefit. Occasionally, however, frictions and differences took
place. At present, the issue of bilateral trade balance -- much too
stressed and even exaggerated by the United States -- has hindered the
healthy development of economic and trade relations between the two
countries. It has also caused concerns among relevant countries and
regions. In our bid to develop Sino-US relations and promote bilateral
trade, we think it necessary to make clear the position and viewpoints of
the Chinese Government on the issue.
I.Soaring Trade Between China
and the United States
In January 1979, the People's Republic of China and the United States
established formal diplomatic relations. Six months later, the
governments of the two countries signed the ``Agreement on Trade
Relations Between the People's Republic of China and the United States of
America'' granting each other the most-favoured-nation trading status.
Since then, Sino-US trade and economic relations entered a period of fast
growth. According to Chinese statistics, Sino-US trade volume was 2.45
billion US dollars in 1979 but rocketed to 42.84 billion US dollars in
1996, with an accumulative volume of 260.6 billion US dollars over the
past 18 years. The United States became China's third largest trade
partner in 1979, and rose to the second place in 1996. According to US
statistics, bilateral trade was 2.37 billion US dollars in 1979 and
topped 63.5 billion US dollars in 1996, totalling 376 billion US dollars
in the past 18 years. Among trade partners of the United States, China
ranked the 24th in 1980 and claimed the fifth place in 1995. Despite
statistical discrepancies, trade figures of the two sides both suggested
an average annual bilateral trade growth rate of more than 18% over the
last 18 years. This has been the mainstream in the development of Sino-US
economic and trade relations.
Chinese statistics indicate that, in 1996, US products accounted for
11.6% of China's total imports, while US statistics show 5.42% of its
imports last year came from China. The United States is one of the
fastest growing markets for Chinese exports while China is also one of
the fastest growing markets for US exports. Both countries' statistics
suggest that between 1990 and 1996, US exports to China grew by more than
16% a year on average, far exceeding the overall US export growth in the
period. China is one of its trade partners with which the United States
scored the highest export growth. This is mainly attributable to the
marked differences in the two countries' resources, economic structures,
industrial setup and consumption levels, and to the fact that their
economies can be complementary to each other. China is a developing
country with low labour costs, but suffers from capital constraint and
relatively under-developed scientific and technological development. The
United States is a developed country with abundant capital and highly
advanced technologies, but suffers from high labour costs. China mainly
sells to the United States labour-intensive products such as textiles,
garments, shoes, toys, electric home appliances and luggage. The United
States mainly sells to China capital- and technology-intensive products
such as aircraft, power generation equipment, machinery, electronics,
telecommunications equipment and chemical machinery, as well as
agricultural products including grain and cotton. So complementary and
mutually beneficial is the structure of their exchanges of goods that it
has greatly pushed the development of bilateral trade.
The sustained growth of Sino-US trade has played an active part in the
economic development and creation of jobs in the two countries. For the
United States, its direct exports to China alone have created 300,000
jobs while bilateral trade development has created at least 1 million
jobs for the US industry and service sectors, and such a trend is marked
by a continuous growth from year to year. China's relatively low labour
costs have cut the prices of daily necessities such as shoes, garments
and toys on the US market, and have helped easing inflation in the United
States, bringing practical benefits to US consumers. A 1994 World Bank
report noted that US consumers would have had to spend an extra 14
billion US dollars per year if the United States had had to import
similar products from other countries instead of China. For China,
millions of workers are involved in the processing and assembling
business for exports to the United States. This has promoted the economic
development of China's coastal areas. China's imports of some relatively
advanced technological products from the United States also help its
modernization.
Sino-US trade is marked by two characteristics: the bulk of the trade is
conducted through entrepot trade and processing trade. Both China's
exports to the United States and US exports to China are largely
conducted through a third partner, mainly the Hong Kong region, while an
overwhelming majority of China's exports to the United States are
processed products -- finished goods made of imported raw materials,
auxiliary parts or primarily-processed items. The domination of entrepot
and processing trade has promoted the fast growth of Sino-US trade
volume, but, at the same time, resulted in a relatively large deviation
between the statistics and reality of trade figures of the two countries.
Apart from trade exchanges, US investment in China has also witnessed
extensive development. By the end of 1996, 22,240 projects with US
investment had been launched in China with a committed investment volume
of 35.17 billion US dollars. Paid-up investment in those projects
totalled 14.29 billion US dollars. Excluding the regions of Hong Kong and
Taiwan, the United States is the second largest investor in China, next
only to Japan. In the mean time, US service exports to China also have
recorded fast development.
Extracted http://www.hellomandarin.com
No comments:
Post a Comment