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  1. #16
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    Quote Originally Posted by GeneChing View Post
    As I've said in our Trade War thread:


    The rising Hate Towards China may exacerbate boycotts and the trade war. However, this will affect products across the board - not just martial arts gear.
    Unfortunately, in regards to manufacturing, companies the world over have ‘put all their eggs in one basket’ in China, and now we will (most likely) see the dire consequences of that. I realize that manufacturing in China is cheaper, but regarding martial arts uniforms alone, I would rather spend more for a quality product that’s going to last, than buy a cheap product that wears out prematurely. Then you haven’t saved any money at all, but are actually spending more in the long run, because you have to keep replacing cheap gear. There is a saying: “Buy quality and cry only once.”

    Not that that has any bearing on me anymore. Since I no longer attend classes or teach, my training “uniform” for the past several years has consisted of sweat pants (or loose-fitting cargo pants) and a T-shirt.

    The time is long overdue for US and other international companies to move manufacturing, if not all back home, then to other, alternate countries outside of China. I say this, and I am not anti-China (but I’m not getting into politics). I am anti-over-reliance on China, or any other country, on making everything we depend on and giving one country so much power.
    Last edited by Jimbo; 05-08-2020 at 11:05 AM.

  2. #17
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    Still going...

    ...it's all still going.

    Hong Kong: China vows to retaliate after Trump ends special economic status
    4 hours ago

    Media caption"Their freedom has been taken away"

    China has vowed to retaliate after the US ended Hong Kong's preferential trade status and imposed sanctions on officials who crack down on rights.

    President Donald Trump said he was acting because China had taken away Hong Kong's freedom after it imposed a new security law.

    Beijing condemned Mr Trump's decision, saying it would impose sanctions on relevant people and entities in the US.

    US-China ties have become increasingly strained over a wide range of issues.

    Apart from Beijing's actions in Hong Kong, Mr Trump has criticised China over its handling of the coronavirus pandemic as well as its military build-up in the South China Sea, its treatment of Muslim minorities and massive trade surpluses.

    Mr Trump's decision means the end of Hong Kong's special trade status with the US, agreed in 1984 when the territory was still a British colony. Hong Kong is expected to be treated the same as mainland China, meaning its goods could be subjected to additional tariffs.

    The controversial security law - which effectively outlaws criticism of China's government - is the most sweeping change to the political landscape of Hong Kong since the UK handed back sovereignty to Beijing in 1997.

    Mr Trump also said he had signed the Hong Kong Autonomy Act, which passed unanimously in Congress earlier this month and penalises banks doing business with Chinese officials who implement the security law.

    In a strongly worded statement, China's foreign ministry described the decision as a "gross interference" in its domestic affairs and said the country would impose retaliatory sanctions to "safeguard China's legitimate interests".

    "The US attempt to obstruct the implementation of the national security law for Hong Kong will never succeed," the statement said.

    "We urge the US side to correct its mistakes, refrain from implementing the act and stop interfering in China's internal affairs in any way. China will firmly respond if the US goes ahead."

    What did President Trump say?

    Speaking in the Rose Garden on Tuesday, Mr Trump said the executive order was intended to "hold China accountable for its aggressive actions against the people" of Hong Kong.

    "No special privileges [for Hong Kong], no special economic treatment and no export of sensitive technologies," said the president, who first announced in May that his administration would begin paring back the territory's special status.

    According to a document released by the White House, any dealings in US property by anyone determined to be responsible for or complicit in "actions or policies that undermine democratic processes or institutions in Hong Kong" would be blocked.

    It also directs officials to "revoke license exceptions for exports to Hong Kong," and includes revoking special treatment for Hong Kong passport holders.

    Mr Trump said the Hong Kong Autonomy Act gave the administration "powerful new tools to hold responsible the individuals and the entities involved in extinguishing Hong Kong's freedom".

    After being questioned by a journalist, the president said he had no plans to speak to Chinese President Xi Jinping.

    Mr Trump also said his administration held China "fully responsible for concealing the [coronavirus] and unleashing it upon the world". His own response to the pandemic has been under scrutiny, as the US has 3.4 million recorded cases, the highest in the world, and more than 136,000 deaths.

    The president's policy address digressed into a lengthy political attack on his Democratic presidential challenger, Joe Biden, ranging from trade and immigration to policing and climate change.

    Perception is reality

    It was not a matter of if, but when. Scrapping Hong Kong's special status will mean companies based there will now have to evaluate what this means for them.

    Hong Kong is a re-exporting hub, which means that goods that go through Hong Kong to the US but have come from somewhere else - like China for instance - have avoided the tariffs the US has slapped on China.

    Now that Hong Kong's special status is gone - mainland Chinese companies may look for another place to send their goods - which would see Hong Kong's port and logistics businesses suffer.

    And how much of an impact will this have on American and multinational companies using Hong Kong as a regional hub? Well, as one business consultant told me - the structural reasons for why a company would use Hong Kong as a hub are still there - low tax rates, good geographic location, convertibility of currency.

    But perception is reality - and if the perception is that doing business in Hong Kong has become so much more onerous - why not decamp to mainland China or Singapore instead?

    What is going on with US-China relations?

    With Mr Trump facing an uphill battle for re-election this November, he and Mr Biden have accused each other of being weak on China.

    On Monday, the administration condemned China's military build-up in the South China Sea, accusing it of bullying neighbours.

    Last Friday, Mr Trump told reporters on Air Force One that a "phase two" trade deal with China was in doubt because of its handling of coronavirus, which he called the "plague".

    The US also officially withdrew last week from the World Health Organization, which Mr Trump had accused of being beholden to China.

    Last week, too, the Trump administration announced sanctions against Chinese politicians who it says are responsible for human rights violations against Muslim minorities in Xinjiang.
    Gene Ching
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  3. #18
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    Wider deficit

    Economy / China Economy
    US trade deficit with China wider than May 2016, when Donald Trump accused China of ‘greatest theft in history
    The US trade deficit with China was 9.15 per cent wider in July 2020 than May 2016, when President Donald Trump accused China of ‘raping’ the US on trade
    After narrowing in the early months of the year due to coronavirus shutdowns, the deficit has recovered in recent months

    Finbarr Bermingham
    Published: 10:25am, 4 Sep, 2020


    US President Donald Trump has vowed on the campaign trail to eradicate a yawning trade deficit with China that he claimed showed the inequities in the global trading system. Photo: Bloomberg

    The United States’ trade deficit with China has crept back up close to pre-coronavirus levels after narrowing when the outbreak battered the Chinese economy.
    The deficit with China – the gap between the amount the US buys from China and what it sells – was US$31.62 billion in July, just 3.46 per cent lower than US$32.8 billion in July 2019, data released by the US Census Bureau on Thursday showed.
    But the rate at which it has grown in recent months will rattle US President Donald Trump, who vowed on the campaign trail in 2016 to eradicate the yawning gap that he claimed showed the inequities in the global trading system.
    In quarterly terms, the deficit climbed 36.8 per cent from the first three months of the year to the second, even if it is markedly lower in year-to-date terms than it was last year, due to a shutdown of China’s export engine in the early months of the year, when it was the first to be hit by the coronavirus pandemic.
    But perhaps most tellingly, the US trade deficit with China was 4.36 per cent wider last month than it was in July 2016, when Trump was on the campaign trail raging against it. Last month’s deficit was 9.15 per cent wider than May 2016, a month when Trump accused China of “raping” the US on trade.
    “Do not forget. We’re like the piggy bank that is being robbed. We have the cards. We have a lot of power with China,” Trump said at the time, during a campaign rally in Fort Wayne, Indiana. “Because we cannot continue to allow China to rape our country. And that is what they’re doing. It’s the greatest theft in the history of the world.”
    That rhetoric has not entirely subsided in the intervening four years, with tensions between the US and China now at their highest level for 40 years. Trade is seen as the one sticking plaster holding the relationship together, but even that is stuttering along, rather than powering home.
    Reuters agricultural columnist Karen Braun reported that US exports of soybeans to China between January and July 2020 were the lowest since 2004, and while August’s volumes have bounced back with an 18 per cent rise year on year, they are the lowest since 2008 if last year was excluded.
    Enormous purchases of American agricultural products in recent weeks have not stopped China from being well short of meeting its obligations under the phase one trade deal, which remains electorally important for Trump, given that key exporting states such as Iowa, Nebraska and Minnesota are considered in play in November’s poll.
    The overall US trade deficit jumped to its highest level in 12 years in July, as imports soared and exports grew by a smaller margin.
    US imports from Taiwan also jumped to record levels in July, helping to add to the overall trade deficit.
    Economists have said that prioritising the reduction in the trade deficit is a fool’s errand, since the economic profile of the consumption-driven US means it will naturally buy more goods from cheaper, lower-end manufacturing hubs.
    Everyone recognises that the overall direction of the economy is grim
    Christine McDaniel
    The fact that it narrowed by 32 per cent from a year earlier in the first quarter was not a cause to celebrate, critics said, because it represented a collapse in consumption in the US and a collapse in manufacturing in China due to the coronavirus.
    “Needless to say, everyone recognises that the overall direction of the economy is grim. But this is what reducing the trade deficit looks like: relative to our exports, we import less. Today, we are importing less because Americans are consuming less during an economic shut down,” wrote Christine McDaniel, a senior research fellow with the Mercatus Center at George Mason University, in April.
    On Monday, China will release its official trade data for August, which is expected to show continued recovery in the export-led economy.




    CONVERSATIONS
    Finbarr Bermingham

    Finbarr Bermingham has been reporting on Asian trade since 2014. Prior to this, he covered global trade and economics in London. He joined the Post in 2018, before which he was Asia Editor at Global Trade Review and Trade Correspondent for the International Business Times

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    Gene Ching
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  4. #19
    A little impatience will spoil great plans.

  5. #20
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    $300 b

    The martial arts industry is way too small to be suing the government but it is being impacted in the same manner as these major companies. This will trickle down to us as consumers soon enough.

    SEPTEMBER 25, 2020 7:35 PM UPDATED 3 DAYS AGO
    Some 3,500 U.S. companies sue over Trump-imposed Chinese tariffs
    By David Shepardson

    3 MIN READ

    WASHINGTON (Reuters) - About 3,500 U.S. companies, including Tesla Inc TSLA.O, Ford Motor Co F.N, Target Corp TGT.N, Walgreen Co WBA.O and Home Depot HD.N have sued the Trump administration in the last two weeks over the imposition of tariffs on more than $300 billion (£235.35 billion) in Chinese-made goods.


    FILE PHOTO: A U.S. dollar banknote featuring American founding father Benjamin Franklin and a China's yuan banknote featuring late Chinese chairman Mao Zedong are seen among U.S. and Chinese flags in this illustration picture taken May 20, 2019. REUTERS/Jason Lee/Illustration

    The suits, filed in the U.S. Court of International Trade, named U.S. Trade Representative Robert Lighthizer and the Customs and Border Protection agency and challenge what they call the unlawful escalation of the U.S. trade war with China through the imposition of a third and fourth round of tariffs.

    The legal challenges from a wide variety of companies argue the Trump administration failed to impose tariffs within a required 12-month period and did not comply with administrative procedures.

    The companies challenge the administration's "unbounded and unlimited trade war impacting billions of dollars in goods imported from the People's Republic of China by importers in the United States," according to a suit filed by auto parts manufacturer Dana Corp DAN.N.

    The suits challenge tariffs in two separate groups known as List 3 and List 4A.” List 3 includes 25% tariffs on about $200 billion in imports, while List 4A included 7.5% tariffs on $120 billion in goods.

    One suit argues the administration cannot expand tariffs to other Chinese imports “for reasons untethered to the unfair intellectual property policies and practices it originally investigated.”

    Companies filing suit include heavy truck manufacturer Volvo Group North America VOLVb.ST, U.S. auto parts retailer Pep Boys, clothing company Ralph Lauren, Sysco Corp SYY.N, guitar manufacturer Gibson Brands, Lenovo's 0992.HK U.S. unit, Dole Packaged Foods, a unit of Itochu Corp 8001.T and golf equipment manufacturer Callaway Golf Co.

    Home Depot’s suit noted it faces tariffs on bamboo flooring, cordless drills and many other Chinese-made products. Walgreen, a unit of the Walgreen Boots Alliance, said it is paying higher tariffs on products like “seasonal novelties; party, first aid, and office supplies; and household essentials.”

    Lighthizer’s office did not immediately respond to requests for comment.

    On Sept. 15, the World Trade Organization found the United States breached global trading rules by imposing multibillion-dollar tariffs in Trump’s trade war with China.

    The Trump administration says tariffs on Chinese goods were justified because China was stealing intellectual property and forcing U.S. companies to transfer technology for access to China’s markets.

    Reporting by David Shepardson; Editing by Tom Brown
    Gene Ching
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  6. #21
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    not even close

    not even surprising
    Oct 2, 2020,12:00pm EDT
    China Is Not Even Close To Meeting Phase One Trade Deal Agreements

    Kenneth Rapoza
    Senior Contributor
    Markets
    I write about business and investing in emerging markets.


    China no where near importing as much as it said it might during phase one trade deal. Pandemic to ... [+] GETTY
    Blame it on the pandemic. Or maybe (depending on whom you ask) it’s just China being China. But the “super great” phase one trade deal that President Trump got done last year is nowhere near the commitments China made in terms of imports.

    Not for manufactured goods. Not for agriculture commodities. And not for Energy exports, either. China, as of July 2020, is not even half way there on any of these three items.

    China imports of manufactured goods was supposed to come in at around $75 billion. It’s around $25 billion as of July. Agriculture imports were supposed to reach around $35 billion. That’s around $9 billion as of July, though like oil and gas exports, this has a lot to do with declining commodity prices for things like soybeans and crude oil. Energy exports to China were targeted for around $25 billion and they are just around $5 billion as of July.

    In the first seven months of the year, the value of energy exports only reached 13.6% of the target.

    With roughly five months left in the year, even if China doubled it, they wouldn’t make it.

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    Lori Ann LaRocco pointed this out yesterday. The author of “Trade War: Containers Don’t Lie”, published last year, says that China commitments don’t equate to real numbers. “Exports do not count until they are on a ship traveling to its destination. Commitments are a commitment, not an official transaction,” LaRocco says.

    Next week, the U.S. Census Bureau will release its trade data for the month of August. The deficit with China is seen being a record breaker of close to $80 billion as many companies stopped importing March through May and started picking up again slowly in June due to factory closures in the U.S. as well as in China.

    The speaker took the stage in front of an audience of marketing professionals and pulled up a slide that made the audience break out in laughter: “WTF is Blockchain.”

    Like “artificial intelligence” and “machine learning” before, “blockchain” is both a buzzword and a black box for many corporate officers, who are being asked to evaluate projects based on a hot concept they are still struggling to grasp. A Deloitte study found that 39% of executives at large companies had little or no knowledge of blockchain.

    uncaptioned
    Holiday 2017 wrapped up blockchain with a bow, and 2018 looks like a promising inflection point for the technology, thanks to increased concern over data security that peaked with the news of huge breaches at Yahoo and Equifax, among others. Retailers—which are particularly vulnerable during high-traffic holiday periods—have been experimenting with blockchain applications for controlling inventory since last year at this time, both to expedite shipments to stores and to prevent “shrinkage” of goods along the way.

    Merchants are also now leveraging the technology in their loyalty programs, to avoid common holiday scams such as return fraud and to protect customer data and avoid breaches. New blockchain-based loyalty programs, such as Loyyal and Blockpoint, launched in time for the holiday season.

    “The more those things keep happening, consumers won’t want something new—they will force something new,” said Dustin Engel, general manager of the Advance Media Team, Analytics and Data Science at ad agency PMG.

    “This is the year of hype. Everybody is learning about it [blockchain] and nobody knows what to do,” said Pavel Cherkashin, co-founder & CEO Of Blockchain Programmatic Corp., a media-buying platform that launched Dec. 1. “Next year will be the year you will see the real business applications around multiple verticals.”

    Right now, companies ranging from technology giants Samsung and IBM to garage-based startups are applying blockchain to a variety of uses, most notably launching cryptocurrencies to compete with Bitcoin in the payments arena. The Deloitte study found that 42% of respondents with knowledge of blockchain think it will disrupt their industries, while 55% think they will lose competitiveness if they don’t adopt it.

    “We have a big bet on it,” said Babs Rangaiah, executive partner at IBM iX.

    “This is going to be a massive shift as it relates to transactions.” He noted that IBM CEO Ginny Rommety has said that blockchain will revolutionize payments the same way the Internet revolutionized communications.

    Knowledge Gap

    The knowledge gap regarding blockchain does open the possibility of overhyping the technology. Many people are using the term for uses it wasn’t meant for or to make things intentionally convoluted.

    Simply put, blockchain is a ledger shared among a group, and only members of that group can make changes by agreement. Each separate point in the transaction is a block in the chain that can’t be changed without changing the other blocks, which provides the first layer of security.

    Palo Alto Networks’ CSO Rick Howard explained: “The blockchain process seems convoluted but there is a purpose. To prevent fraud, the complex math problem that the system generates is dependent on the data from the previous block. The math problem for that block is based on the block before it—and on and on to the beginning. If a Bitcoin practitioner wanted to secretly subvert the values in the transaction chain without anybody knowing it…he or she would have to solve all the math problems from the block they want to change up to the current block in the time it takes the miners to solve the current math problem. I know that sounds like a lot of computer mumbo jumbo, but trust me, there is not enough computational power in the universe to accomplish this feat.”

    Updates are distributed across the network and encrypted, so there is no central point of attack, providing the next security layer. Entities on the blockchain can remain anonymous, but everyone in the chain sees the transaction progress, which provides a third security layer.

    “You can see where a technology such as blockchain might be useful in all kinds of areas where people and corporations and governments have to officially transact with each other,” explained Howard. “Venture capitalists are pouring money into startups that are trying to build decentralized cloud storage systems, smart contracts, voting systems, and loyalty programs, to name a few.”

    Blockchain is a valuable tool in the security toolbox, “but it is really only one tool,” said Saito. “The distributed ledger really helps create a redundancy to assure that the integrity of the entire system is not usurped by a few bad actors, but the ‘distributed-ness’ of this will maintain that consistency,” he explained. The blockchain could be modified to add authentication and authorization features that make it more secure, but its underlying feature is integrity, the ability to maintain data unmodified.

    “Blockchain solves the problem that if you have no central authority keeping everybody honest and knowing who everybody is, how do you trust the other side of the transaction when you are most likely transacting with people whom you don’t know if you can trust?” said Howard.

    The ability to simplify trust relationships and validate transactions efficiently reduces the cost and complexity of counterparty trades and reduces personnel overhead needed to maintain, audit, and provide compliance of those ledgers, said Garry Coldwells, senior manager, major accounts, at Palo Alto Networks. Additionally, “the cost of establishing and maintaining blockchains is remarkably low compared with the current model.”

    Still Some Hurdles

    Some of the obstacles to adoption remain, namely knowledge and reputation hurdles, which will have to be addressed this year. For one, in the public’s consciousness, blockchain is thought to be synonymous with Bitcoin and the other cryptocurrencies it enables and that still carry a whiff of their extra-legal origins. A study released last summer by YouGov found that one-third of Americans had never heard of Bitcoin and 29% thought cryptocurrencies are illegal.

    “Cryptocurrency remains a black box and is commonly viewed as a ‘dark net’ entity fraught with risk and thievery” among laypeople, said Coldwells. This lack of regulation does give some pause. Coldwells noted most of the calls for regulation come from established securities houses that stand to lose revenue to cryptocurrencies. But several recent frauds in the market have led to growing talk of regulation, a contradiction to the decentralized blockchain ideal, he said.

    Experts also warn about assuming blockchain is completely hacker-proof. “No doubt, someone will be working to crack it, but that happens,” said IBM’s Rangaiah.

    Any such misgivings, however, most likely won’t stop development of blockchain: “Your best research is probably going to be in your own company. Because, right now, someone in your company is looking at a blockchain solution,” said PMG’s Engel. “You can walk down to your IT department and say ‘Blockchain!’ and people will pop out of the woodwork.”
    Gene Ching
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  7. #22
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    Not so easy

    How China Won Trump’s Trade War and Got Americans to Foot the Bill
    Bloomberg News
    January 11, 2021, 1:00 PM PST Updated on January 12, 2021, 5:35 AM PST
    Chinese trade surplus, exports rose despite Trump’s rhetoric
    Biden administration likely to favor technology controls

    U.S. President Donald Trump famously tweeted that “trade wars are good, and easy to win” in 2018 as he began to impose tariffs on about $360 billion of imports from China. Turns out he was wrong on both counts.

    Even before the coronavirus infected millions of Americans and sparked the steepest economic downturn since the Great Depression, China was withstanding Trump’s tariff salvos, according to the very metrics he used to justify them. Once China got the virus under control, demand for medical equipment and work-from-home gear expanded its trade surplus with the U.S. despite the levies.

    While trade tensions between the world’s two biggest economic powers didn’t start under Trump, he broadened the fight with the unprecedented tariffs and sanctions on technology companies. The tougher approach, according to the scorecard that follows, didn’t go as he hoped. But he’s leaving his successor Joe Biden a blueprint of what worked and what didn’t.

    “China is too big and too important to the world economy to think that you can cut it out like a paper doll” said Mary Lovely, an economics professor at Syracuse University. “The Trump administration had a wake-up call.”

    The U.S. Trade Deficit Grew
    Trump vowed in his 2016 election year to very quickly “start reversing” the U.S. goods trade deficit with China, ignoring mainstream economists who downplay the importance of bilateral deficits. However, the deficit with China increased since then, hitting $287 billion in the 11 months to November last year, according to Chinese data.

    Surplus Soars
    China's trade surplus with the U.S. hits record as Trump's term ends
    Source: China's General Administration of Customs

    Note: Jan.-Feb. 2020 is combined by source to smooth lunar new year volatility.

    The deficit did fall year-on-year in 2019, as U.S. companies switched to imports from countries like Vietnam, but it remained higher than the $254 billion gap in 2016. That was partly because Beijing’s imposition of retaliatory tariffs on about $110 billion in goods reduced its imports of American products, and these only started recovering in the last few months of 2020.

    As part of the phase-one trade deal signed a year ago, Beijing made an ambitious vow to import $172 billion worth of U.S. goods in specific categories in 2020, but through the end of November it had bought just 51% of that goal. The slump in energy prices amid the pandemic and the problems with Boeing Co.’s planes played a part in that failure.

    The persistent deficit demonstrated how reliant companies are on China’s vast manufacturing capacity, which was highlighted again by the pandemic. China was the only country capable of increasing output on a big enough scale to meet surging demand for goods such as work-from-home computers and medical equipment.

    President Xi Jinping expressed his confidence in China’s rise Monday, telling officials that “time and the situation are in our favor.” The Chinese leader said that he saw “opportunities in general outweighing challenges,” a marked shift from his sometimes dire-sounding warnings of recent months.

    China’s Export Machine Rolls On
    Trump repeatedly said that China’s accession to the World Trade Organization in 2001 caused its economy to take off like a “rocket ship,” a result he viewed as unfair. As it turned out, Trump’s trade war with China coincided with another expansion in Chinese exports. After shrinking for two straight years in 2015 and 2016, China’s total shipments grew each year after Trump took office, including in 2019 when exports to the U.S. fell.

    China Diversifying From the U.S. Market
    U.S. taking a shrinking share of China's growing exports
    Source: Compiled by Bloomberg from Chinese customs data

    Jan.-Feb. 2020 is combined by source to smooth lunar new year volatility.

    A group of 10 Southeast Asian nations replaced the U.S. as China’s second-largest trading partner in 2019. The shift to Asia is likely to continue as Southeast Asian economies are projected to grow faster than developed countries over the next decade. Those trade links will be further cemented by the Regional Comprehensive Economic Partnership pact signed late last year, which will see 15 regional economies gradually drop some tariffs on each others’ goods.

    What Bloomberg Economics Says...
    The fact that exports were little affected after four years of trade war speaks to the resilience of China’s manufacturing capacity. However the trade war has exposed China’s vulnerability in certain bottleneck sectors such as high tech.
    -- Chang Shu, chief Asia economist

    U.S. Companies Stay in China
    Trump said that tariffs would encourage U.S. manufacturers to move production back home, and in a 2019 tweet he “ordered” them to “immediately start looking for an alternative to China.” But there is little evidence of any such shift taking place.

    U.S. direct investment into China increased slightly from $12.9 billion in 2016 to $13.3 billion in 2019, according to Rhodium Group data.

    U.S. Investment Slowed But Hasn't Collapsed
    Source: Rhodium Group

    More than three quarters of 200-plus U.S. manufacturers in and around Shanghai surveyed in September said they didn’t intend to move production out of China. U.S. companies regularly cite the rapid growth of China’s consumer market combined with its strong manufacturing capabilities as reasons for expanding there. “No matter how high the Trump administration raised any tariffs, it was going to be very difficult to dissuade US companies from investing,” said Ker Gibbs, president of the American Chamber of Commerce in Shanghai.

    Economic Losses on Both Sides
    Trump claimed that tariffs had boosted the U.S. economy, while causing China’s economy to have its “worst year in over 50” in 2019. However, direct economic impacts were small relative to the size of the two countries’ economies as the value of exports between them are tiny relative to gross domestic product.

    China grew at or above 6% in both 2018 and 2019, with tariffs costing it about 0.3% of GDP over those years, according to Yang Zhou, an economist at the University of Minnesota. By her estimate, the trade war cost the U.S. 0.08% GDP over the same period. The clearest winner was Vietnam, where the tariffs boosted GDP by nearly 0.2 percentage point as companies relocated.
    continued next post
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  8. #23
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    continued from previous post

    U.S. Consumer Foots the Bill
    Trump repeatedly claimed that China was paying for the tariffs. Economists who crunched the numbers were surprised to find that Chinese exporters generally didn’t lower prices to keep their goods competitive after the tariffs were imposed. That meant U.S. duties were mostly paid by its own companies and consumers.

    The tariffs led to an income loss for U.S. consumers of about $16.8 billion annually in 2018, according to a National Bureau of Economic Research paper.

    Another own goal: Tariffs on imports from China tended to reduce U.S. exports. That was because globalized supply chains mean manufacturing is shared between countries, and the U.S. raised the costs of its own goods by levying duties on imports of Chinese components.

    U.S Exports Fell in 2019
    Shipments globally were slow, not just to China
    Source: U.S. Census Bureau, Bloomberg calculations

    Companies which together account for 80% of U.S. exports had to pay higher prices for Chinese imports, according to analysis of confidential company data by researchers at the National Bureau of Economic Research, the U.S. Census Bureau and the Federal Reserve, reducing export growth.

    The Rustbelt Stayed Rusty
    Trump campaigned hard back in 2016 on pledges to revive the Rust Belt by taking on China and bringing the jobs back home. It didn’t happen.

    Growth in U.S. manufacturing jobs flatlined in 2019, partly due to falling exports. Even regions home to industries such as steel, which received explicit protection from Trump’s tariffs saw declines in employment, according to research by New York University Stern School of Business economist Michael Waugh, suggesting that the trade war didn’t significantly alter the trajectory of U.S. manufacturing.

    “That stuff is just naturally going to move offshore. The protection maybe delays it a little bit,” Waugh said. “There’s no evidence that the tariffs benefited workers.”

    The pandemic’s disruption to the world economy in 2020 makes it difficult to estimate the effect of the tariffs on jobs and investment.

    China Changed at Its Own Pace
    The Trump administration claimed that tariffs provided leverage over the Chinese, which would force them to make reforms to benefit U.S. companies. “I love properly put-on tariffs, because they bring unfair competitors from foreign countries to do whatever you want them to do,” Trump said.

    The biggest victory claimed by the administration as part of its trade deal were promises from Beijing to enhance intellectual property protections. But that was probably in China’s interests anyway.

    Mark Cohen, an expert on Chinese law at Fordham University in New York, said that while Beijing has made “tremendous legislative changes” to strengthen IP protection in the past two years, its own motivation to enhance innovation may have been a more important factor than U.S. pressure. The agreement didn’t “push the structural reforms in China that would make its system more systemically compatible with most of the world,” he added.

    Chinese companies paid a record $7.9 billion in intellectual property payments to the U.S. in 2019, up from $6.6 billion in 2016, and its courts imposed some record-breaking fines on IP infringement involving U.S. companies. But that rate of increase was slower than for its IP payments to the whole world, according to World Bank data, showing the payments to the U.S. were part of a general trend.

    Rising Royalties
    China's payments for use of U.S. intellectual property have been rising
    Source: Organisation for Economic Co-operation and Development

    Washington was also not able to extract any significant commitments on reform of China’s state-owned enterprises, which were also cited as a justification for tariffs.

    Trade War to Tech Wars
    It’s now up to President-elect Biden to decide whether to keep up the trade war. In a recent interview, he said he wouldn’t remove the tariffs immediately and would instead review the phase one deal.

    Compared with tariffs, an escalating conflict over technology is of more concern to China. Sanctions and export restrictions imposed by Washington have threatened the viability of leading technology companies such as Huawei Technologies Co. and microchip maker Semiconductor Manufacturing International Corp. That is an existential threat to Beijing’s plans for economic growth.

    “If the U.S. continues to increase its technological blockade, China’s modernization towards the high-end of the global industrial chain will undoubtedly be affected,” two researchers at the official Communist Party school in the province of Jiangsu wrote in an article.

    So far, the impact of U.S. actions has been to accelerate Beijing’s drive for technological self-sufficiency. The issue has rocketed up the Communist Party’s agenda, symbolized by a statement last month that increasing “strategic scientific and technological strength” is the most important economic task.

    — With assistance by Tom Hancock, James Mayger, and Jeff Black

    (Updates with speech by Xi Jinping in ninth paragraph.)
    There are dynamic graphs in this article that I couldn't copy&paste. You'll just have to follow the link.
    Gene Ching
    Publisher www.KungFuMagazine.com
    Author of Shaolin Trips
    Support our forum by getting your gear at MartialArtSmart

  9. #24
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    "That is a sleeping dragon. Let him sleep! If he wakes, he will shake the world."

    World shook.

    Feb 1, 2021 - Economy & Business
    Trump's trade war on China was a failure in every possible way


    Dion Rabouin, author of Markets

    Illustration: Eniola Odetunde/Axios

    The Biden administration plans to review the phase one U.S.-China trade deal, White House press secretary Jen Psaki said on Friday. Based on publicly available data, it's hard to imagine they'll find anything other than a debacle.

    Driving the news: China isn't even close to fulfilling its end of the deal — having come up 42% short of its commitment, Chad Bown, a fellow at the Peterson Institute for International Economics, reported late last week.

    The phase one deal was meant to be the Trump administration's reward for U.S. farmers, manufacturers and other business owners who had been bludgeoned by Trump's tax on American businesses via the trade war's tariffs.
    What was supposed to happen: The trade war was billed as a plan to bring China to its knees by choking off the all-important American market with 25% tariffs on many imports that would rein in the U.S. trade deficit, boost American exports and slow China's rise as a global superpower.

    What really happened: "The trade war with China hurt the US economy and failed to achieve major policy goals," a recent study commissioned by the U.S.-China Business Council argues, finding that the trade war reduced economic growth and cost the U.S. 245,000 jobs.

    Last year, the U.S. trade deficit widened to its largest on record. In the fourth quarter, the U.S. goods trade deficit hit its highest share of GDP since 2012 and the U.S. current account deficit jumped to its highest level in more than 12 years in the third quarter.
    Foreign direct investment to the U.S. fell 49% in 2020 — outpacing the overall global decrease of 42%.
    These trends had all been moving in this direction since 2017, and were accelerated by the coronavirus pandemic as Trump refused to remove tariffs despite their strain on businesses.
    The big picture: "The tariffs forced American companies to accept lower profit margins, cut wages and jobs for U.S. workers, defer potential wage hikes or expansions, and raise prices for American consumers or companies," analysts at Brookings noted in August.

    The other side: China's trade surplus last year hit a record $535 billion, up 27% from 2019. Exports rose 21.1% in dollar terms in November year over year and 18.1% in December from a year earlier, touching an all-time high.

    For the full year, the trade surplus with the U.S. was $317 billion, 7% higher than in 2019.
    Foreign direct investment to China rose 4% to $163 billion.

    Reproduced from Peterson Institute for International Economics; Chart: Axios Visuals
    Most economists agree that trade deficits don't actually hurt an economy. And while the U.S. trade deficit with China did decrease somewhat during Trump's time in office, the deficit increased with other countries and overall.

    Meanwhile, China's trade surplus and its trade with other countries increased.
    The bottom line: In addition to hurting U.S. businesses and workers, tariffs also drive up prices, and inflation expectations are starting to rise.

    The U.S. current account deficit also is helping further weigh down the value of the dollar, economists say, another factor that could boost inflation.
    Manufacturers, including Whirlpool and Polaris, have recently said they are struggling to meet consumer demand due to supply-chain constraints and coronavirus-related safety measures — both of which are pushing up costs.
    Gene Ching
    Publisher www.KungFuMagazine.com
    Author of Shaolin Trips
    Support our forum by getting your gear at MartialArtSmart

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