US-China trade tensions are never far from the surface these days, but news that the China may become America’s third largest export market (overtaking Japan) may help. Exports are reported (by the Washington Post) to have grown by 20.5 percent in 2005 and by 36.5 percent in the first five months of this year, compared to the same period in 2005. This growth was described by Frank Lavin, the Under-Secretary of State, as being movement in a “positive” direction. So, what is China importing?
“China’s first-quarter customs statistics showed that the country imported machines and electronics of 93.73 billion dollars and hi-tech products of 53.37 billion dollars, up 30.8 percent and 33.2 percent respectively, and 21 percentage points and 12.8 percentage points more than the same period of last year…The import values of auto mobiles and planes increased 1.1 and 2.1 times, respectively.”
The removal of barriers to the export of “sensitive” hi-tech products from the US would push this trend even further, as could an upward valuation of the RMB. We can still, however, expect a big trade surplus for Beijing, and more worries from Washington.
See news sources:
Washington Post – United States
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