US-China trade war might cause two million job losses
America's trade deficit with China, probably the world's largest economic imbalance is estimated to result in about two million job losses in the US, the White House said, defending President Donald Trump's decision to initiate strong actions against China's "unfair" trade practices. Trump imposed $60bn of tariffs on Chinese imports to punish the country for its "unfair" seizure of American intellectual property. Here's more.
Trump orders $60 billion in tariffs on Chinese imports
Trump's tariff order on China could escalate the already tense trade relations between the world's two biggest economies. Trump directed the US trade representative to level tariffs on about $60 billion worth of Chinese imports after a seven-month investigation into the intellectual property theft, which has been a longstanding point of contention in US-China trade relations. China also announced retaliatory measures against the US.
Trade deficit to result in two million jobs in China
A senior Trump administration official said, "By some calculations, every billion dollar of trade deficit that arises from market-distorted policies, costs us about 6,000 jobs." "A very conservative calculation...is that trade deficit results in about two million more jobs in China and two million less here. This is a serious problem that the US side is keenly aware of," the senior official added.
China's unfair trade practices result in $370bn goods trade benefit
China's "unfair" trade practices resulted in a goods trade deficit of $370bn. It is for China to decide what course it wants to take, Trump administration said. "The point here is that China will have a choice as to how to respond, and they have benefited far more from this relationship than we have. We will certainly take that into account," the official added.
Concerns with Chinese economic practices are widespread around the world
The typical American corporation that wants to go to China and sell its goods into the Chinese market is on the horns of a dilemma. The senior official said the concerns with Chinese economic practices are widespread throughout the United States and around the world. "We have heard from many of our trading partners that they share many of these concerns," the official said.
China benefits far more from the US-China trade relationship
Since 2001, when China joined the World Trade Organization, its economy has grown from $1 trillion of GDP to $12 trillion; roughly an 800% growth rate. "During the same period of time, the American economy sputtered. It went from an annual growth rate of about 3.5% between 1947 and 2000, down to around two percent," said an official.
Senate Finance Committee Ranking Member Ron Wyden on China's practices
"China has cheated and bullied American industry on trade for decades, causing massive economic wreckage to workers, communities across America. We must stand up against China's trade blackmail, so I am encouraged that the administration is focused on protecting the technologies that China publicly targeted."
