Source: Global Times Published: 2019-8-8
China's overall foreign trade expanded steadily in the first seven months of the year, with a 4.2 percent year-on-year increase, while trade with the US declined, customs data showed Thursday.
Experts noted that the US, which was formerly the No.2 trading partner of China, might fall into fourth spot soon if trade tensions worsen.
The Association of Southeast Asian Nations has leapfrogged the US to become the second-largest trading partner of China. Bilateral trade from January to July reached 2.35 trillion yuan ($334 billion), up 11.3 percent year-on-year, according to China's General Administration of Customs.
China-US trade, by contrast, dropped 8.1 percent year-on-year to 2.1 trillion yuan.
Detailed information from the customs agency showed that US exports to China dived 24 percent in the period to 473.9 billion yuan, less than China's fourth-largest trading partner - Japan - which had exports to China worth 653.5 billion yuan.
Dong Shaopeng, a senior research fellow with Chongyang Institute for Financial Studies of Renmin University of China, said that with the US pursuing protectionist trade policies and threatening new tariff hikes on Chinese products, trade between the world's two largest economies will further weaken and the negative effects will eventually spill over to the global economy.
"There's mutual demand for products in China and the US. But China has more flexibility since its domestic market keeps growing and overseas markets including countries and regions under the Belt and Road Initiative (BRI) framework keep growing," Dong said.
China's bilateral trade with BRI-related economies increased by 10.2 percent to 5.03 trillion yuan in the first seven months.
"Thanks to years of construction of BRI projects including infrastructure and telecommunications, the potential of the huge market has emerged and the trade between China and BRI markets will keep growing at a faster pace," Zhang Jianping, director general with the Center for Regional Economic Cooperation under the Ministry of Commerce, told the Global Times on Thursday.
Daily necessities that the US imports from China have fewer substitutes and new tariffs will mostly show up in the costs to US consumers and related companies, especially when multiple shopping peak seasons are coming in the second half of the year, such as Thanksgiving and Christmas, Dong noted.
China's soybean imports decreased 11.2 percent year-on-year in the first seven months to 46.9 million tons, according to the customs data.
Dong said China has adjusted its soybean consumption, such as lowering the soybean proportion in swine feed, and started to expand its supply chain, including imports from Russia.
Chinese companies stopped purchasing US agricultural products after the Trump administration threatened to impose 10 percent tariffs on $300 billion worth of Chinese imports, Ministry of Foreign Affairs spokesperson Hua Chunying said on Tuesday.
"Cooperation must proceed in a friendly and fair environment," Dong said.
Other than trade, there's also information showing that investments from China into the US plunged recently.
China's Ministry of Commerce on July 25 said that China's non-financial direct investment in the US was $1.96 billion in the first half of 2019, down about 20 percent year-on-year.
Dong Shaopeng is a senior fellow of Chongyang Institute for Financial Studies at Renmin University of China.