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Global Times

China pushes back accusations, releases report on trade benefits for US amid trade war

Global Times

By Wang Cong Source:Global Times Published: 2019/6/6 16:43:42

China's Ministry of Commerce (MOFCOM) on Thursday released a detailed report on how the US has greatly benefited from trade with China, in a clear attempt to push back repeated claims from US officials that the US was losing billions to China.

The move is the latest of a series of recent efforts from Chinese government in response to unsubstantiated accusations from the US amid a bitter trade dispute, and further demonstrates its firm position to beat back US pressure.

In the lengthy report, the MOFCOM pointed out that bilateral trade in goods has grown 252 times from $2.5 billion in 1979 to $633.5 billion in 2018, while services trade grew to $125 billion and two-way investment reached $160 billion.

"Trade and economic cooperation between China and the US have brought tangible benefits to the two peoples and contributed to a prosperous and stable world economy," the ministry said, noting that if the US was "losing" the bilateral trade, it could not reach where it is now.

US officials, including President Donald Trump, have been claiming that the US has been losing $500 billion a year, citing the US trade deficit with China, to justify its costly trade war with China, even though many economists, including those from the US, said trade deficits are not losses.

"Since the Trump administration took office, it has disregarded the win-win nature of China-US economic and trade cooperation and promoted the narrative of the US 'suffering' in trade with China and even used the trade deficit as an excuse to instigate trade tensions," the report said. "The responsibility lies entirely on the US."

The report further pointed out that China had a $40.53 billion deficit in the services trade and that the US calculation did not include Chinese imports of components from other countries. It concluded that the US deficit with China was about $153.6 billion, 37 percent lower than what US officials claimed.

It also said that US companies had generated about $700 billion in revenue from the Chinese market in 2017 plus the $241 billion they gained in the goods and services trade, or a total of $940 billion from the Chinese market.

"Having reliable, unbiased and sustainable data to ascertain the outcome of US corporations is the prerequisite for extracting accurate information," said Liang Haiming, dean of Hainan University's Belt and Road Research Institute, who closely follows the China-US trade relationship.

At a time when US officials continue to pedal false claims and constantly raise stakes in the trade war by threatening more tariffs, it was necessary for China to debunk the claims, Liang said.

"First, this tells people that US companies have benefited greatly from the Chinese market; second, sanctioning China will also hurt the US," Liang told the Global Times.

Chinese officials have been mounting a multi-pronged response to the US since trade talks broke down last month after US officials increased tariffs on $200 billion in Chinese goods and blacklisted Chinese telecom firm Huawei.

In response, China has also raised tariffs on $60 billion in US products. Officials have also announced a plan to establish what's known as a "unreliable entity list" that could punish US companies from hurting Chinese interests without legitimate commercial grounds. China has also hinted at other countermeasures, including restricting rare-earth exports to the US.

In responding to US accusations that Chinese officials backtracked in trade talks, China on Sunday released a white paper that detailed how the US flip-flopped during the negotiations and resorted to tariffs to pressure China into giving concessions.

The report said that the US bears the sole responsibility for the breakdown and that China will never give any ground on core issues of principle.



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