China-US Trade Relations Tighten
Stronger trade ties between China and the United States is the Cornerstone of China-US ties, that cooperation will likely have the same significance for the world’s economy.
Tightening China-US trade cooperation will be of great significance for the development of both China and the United States as well as for world prosperity, Chinese President Xi Jinping told Chinese and US entrepreneurs in Seattle in Washington State Wednesday.
In Y 1993, the economic size of the State of California alone was about 2X as much as the total of China’s, and according to the World Bank, China’s GDP (gross domestic product) in the year was just 6.4% that of the United States.
In Y 2015 China has become the 2nd-largest economy of the world, with an economic aggregate at about 60% of that of the United States.
China and the United States, as the world’s largest developing economy and largest developed economy, respectively, are the “twin engines” for global economic growth. In Y 2014, China contributed 27.8% to global economic growth, while the United States contributed 15.3%, according to the International Monetary Fund (IMF).
This new economic scenario means that China-US relations are moving into a new phase.
In a speech delivered at a banquet in Seattle Tuesday, Xi called for advancing the new model of major-country relationship between China and the United States and working together to promote world peace and development.
Analysts noted that the foundation for China and the United States to build the new type of major country relationship is increasingly being consolidated as trade relations between the 2 countries are expanding, deepening, and tightening
Currently, there are over 90 bi-lateral dialogue mechanisms between China and the United States, which cover almost every aspect of China-US trade, that is beneficial to the 2 nations and the world.
In Y 1979, trade value between China and the United States was just $ 2-B, but it exceeded $550-B by Y 2014. Currently, China is the United States’ 2nd-largest trade partner, 3rd-largest export market and top import destination.
Trade between China and the United States is driving bi-lateral investment.
According to a joint study by the National Committee of US-China Relations (NCUSCR) and Rhodium Group, from Ys 2000 to 2014, investment by Chinese enterprises in the United States was close to $50-B, and it is expected to reach $100 – 200-B by Y 2020 and create 200,000 to 400,000 jobs in the United States.
Judging from the size of the U.S. and Chinese economies, there is still great potential for bilateral investment between the two countries.
Sean Miner, a researcher at the Peterson Institute for International Economics, said that the United States has invested 2 trillion dollars worldwide, but only 2 percent in China, while China, a large investor in the world, has minor investment in the United States.
Currently, the spotlight is on industrial cooperation and technical innovations. Against this backdrop, China-US cooperation will have new and broader prospects in the future.
In this Era of Globalization, if China and the United States cooperate, the world will benefit, but if China and the United States confront each other, the world will suffer.
President Xi said that China and the United States account for 33% of the world economy, 25% of the global population, and 20% of global trade.
“If two big countries like ours do not cooperate with each other, just imagine what will happen to the world,” Xi said, noting that both history and reality show that China and the United States stand to gain from cooperation and lose from confrontation.
China-US cooperation affects the industrial chains and trade sector, and the stability of finance markets and global confidence.
Xi’s current visit to the United States will help chart the course for China -US ties.
Next Xi travels to Washington, DC to meet with US President Barack Hussein Obama.
Stay tuned…
HeffX-LTN
Paul Ebeling
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