Peking University, May 30, 2019: On May 22, the National School of Development of Peking University hosted the 173rd NSD Policy Talk themed on "China-US Trade and Relations: Challenges and Prospects”. After heated discussions and in-depth analysis, the panelists agreed that we should objectively treat China-US trade frictions and that the escalation of economic and trade conflicts would eventually make American folks suffer, and China would always focus on its own work under such circumstance.
Tariffs harm the US citizens most
Importing goods from China should not be considered as the mercy given by the United States. “Trade should be of mutual benefit,” said Professor Justin Yifu Lin, honorary dean of NSD, “When it comes to international trade, we should not focus on the trade surplus or the deficit between two countries, but on the trade balance between one country and the whole world. In other words, the main reason for the trade deficit of one country lies in its excessive consumption of products and the shortfall of savings. Therefore, if one country wants to tackle trade deficit, it should seek the solution at home instead of raising the tariff like what the US has done to China, Canada, Mexico, Europe, and Japan, the effect of which will only be counterproductive.
Lin pointed out that even if the US government had adopted such rigorous protectionist measures, the statistics of 2018 show that the US foreign trade deficit had increased by 12.1%, and the US trade deficit with China had increased by 11.7%. The US trade deficit problem was not solved but deteriorated. It is the U.S customers and Chinese producers that pay the price under the influence of the trade friction.
The image of America in the trade war
In the China-US trade disputes, the United States has been willfully escalating frictions and attempting to undermine Chinese enterprises by exerting administrative pressure, so as to protect its own underdeveloped industries. Chen Wenling, chief economist of the China Center for International Economic Exchanges, said that it was unacceptable for the United States to use its national power to sabotage Chinese industries. The measures were not only disrupting the industrial chain of companies like Huawei and DJI but also interrupting the development of the entire industry and violating the laws of economy, trade, industrial development, human progress and social development and disturbed the trend of historical development.
"Having negotiated for more than one year, the United States has always attributed the trade conflicts to China, yet reticent to its own problems," said Zhang Yuncheng, director of the World Economic Research Institute from China Institutes of Contemporary International Relations.
As for the reason why such a huge trade deficit exists between the United States and China, Zhou Shijian, senior research fellow at the Institute of China-US relations at Tsinghua University, explained that the reason behind this is that what China wants to purchase is not what the US sells "The trade deficit between the United States and China in 2018 was $419.2 billion. But when it comes to the EU, whose industrial level was basically equivalent to the United States, the trade deficit with China was only $135.1 billion. The United States has been China's largest export market since 2012. However, the US is reluctant to sell many products to China, so China's largest trading partner turns to the EU; after all EU is willing to export a considerable number of goods to China”. Not allowing American high-tech products to be sold to China, the United States, nevertheless, enjoys the high-quality goods that are made in China and accuses China of causing the huge trade deficit.
Why is nobody able to stop the unilateral trade war? Da Wei, who is an assistant to the president of the University of International Relations, said that this is the consequence of a unipolar world; though the China-US trade conflicts also mark the loosening of U.S unipolarity.
Da Wei pointed out that the Sino-US relationship was unprecedented in history. China and the United States are two countries that increasingly match in comprehensive strength and differ in political systems, but deeply interdependent. On the one hand, we should pay high attention to the current Sino-US relations, especially the trend of trade frictions. On the other hand, we should not be led astray by the trade war and continue to focus on our own development instead.
Zha Daojiong, professor of the School of International Studies and the Institute of South-South Cooperation and Development of Peking University, said, "What is the bottom line for China to deal with its relations with the United States?" It should serve China's continual development and the use of all available factors. We must improve the competitiveness of technological products and labor, expand export and improve the quality of opening up. In this process, whether the US Administration approves or not, we shall put its whim in a secondary position.
Zhang Yuncheng also said that as long as China maintain its position in the global industrial chain, external interferences would not hinder China's progress. Yu Zhaojie, deputy dean of NSD, thought that if China and the United States could reach an economic and trade agreement, it is good of course; but if the recent economic and trade frictions continue to intensify, we should respond positively through high-quality development and high-level openness. We should always do our own things first, and finally realize our dreams through our own efforts.
Note: The views expressed in this article do not necessarily represent those of Beida News.
Written by: Fang Jiangchen, Chen Yubing
Edited by: Wei Yunqi
