Xinhua International Times: The US must stop blaming China on the trade deficit

The US trade deficit widened to a record level in 2021, according to data released by the Commerce Department.Some US officials and media have blamed China for their country’s trade imbalance.Hyping up the trade deficit with China shows that the US is unwilling to face up to its structural problems, and further exposes the true face of the US trade bullying.Historically, the continuous expansion of the US trade deficit is rooted in changes in its economic structure.Decades of decline in manufacturing and expansion in services have left the US dependent on imports for much of its goods.At the same time, the US government imposed export control on high-tech enterprises and their products, leading to long-term export restrictions on high-tech products.The us trade deficit has widened precisely as a result of a series of self-selected and self-limiting actions.Abuse of dollar hegemony is an important driver of US trade deficit.With the help of dollar hegemony, the US imports goods and services at a lower cost and inevitably runs a certain trade deficit.After the end of the Bretton Woods system and the decoupling of the dollar from gold in the 1970s, the hegemony of the dollar lost further constraints.Since then, the US has pursued expansionary monetary policy and financial liberalization, which exacerbated asset bubbles, stimulated excessive consumption and excessive borrowing, leading to rising trade deficits.In recent decades, American households have generally maintained a high-consumption, low-saving consumption pattern.As Stephen Roach, a senior fellow at Yale University, points out, an important reason for the widening US trade deficit is the falling domestic savings rate.Tu Xinquan, director of the China Institute of WTO Studies at the University of International Business and Economics, pointed out that it is a basic economic sense that a country’s overall foreign trade balance depends on its own macroeconomic structure, not its trading partners.The growth in the US trade deficit is a reflection of its own demand, not external influence.From a practical point of view, under the dual stimulus of fiscal and monetary policies, us consumer demand is heating up strongly and imports have increased significantly.At the same time, the overall global economic recovery has been weak, with relatively limited growth in U.S. exports struggling to offset the surge in imports.The US trade deficit is exacerbated by two factors.In terms of trade with China, some Southeast Asian economies’ exports to the US have been disrupted by the COVID-19 pandemic, which has further expanded US demand for Chinese products. Meanwhile, US manufacturing exports to China have yet to fully recover due to the epidemic.It has also been noted that since the US unilaterally provoked economic and trade frictions with China, the US has put a large number of Chinese companies on its export control list, which has further reduced US exports to China.Ignoring the reasonable demands of its businesses and consumers, the US interferes with normal economic and trade exchanges with China for political purposes, distorting bilateral trade relations and leading to a widening trade deficit.The solution to the trade deficit with China is clearly in the hands of the US.One important fact that the US has been ignoring is that China has been the main source of its service trade surplus in recent years.According to the US Department of Commerce, the TOTAL us surplus in services trade in 2021 exceeded us $230 billion, of which the US has always maintained a surplus in services trade with China.The US was The largest source of China’s service imports in 2019, accounting for 16.6 percent of China’s service imports, according to the Report on China’s Service Imports 2020 released by the Ministry of Commerce.China always maintains that problems in bilateral economic and trade relations should be properly solved by the two sides in the spirit of mutual respect and consultation on an equal footing.To blame China on the trade deficit issue is nothing but trade bullying that disrespects history and reality and will not help solve the issue.The US should meet China halfway, focus on common interests, make the pie of mutual benefit bigger and bring China-Us economic and trade exchanges back on track.Only a sound and stable China-Us economic and trade relationship can benefit the people of the two countries and the world at large.(Xinhua)

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