Trade: U.S.A & China

Introduction

• China is currently our 2nd largest goods trading partner

• Goods exports totaled $104 billion.

• Goods imports totaled $399 billion.

• Trade in services with China (exports and imports) totaled $36 billion.

• Services exports were $25 billion.• Services imports were $11 billion.

The U.S. services trade surplus with China was $13 billion in 2011.

Exports

• China was the United States= 3rd largest goods export market in 2011.

• U.S. goods exports to China in 2011 were $103.9 billion, up 13.1% ($12.0 billion) from 2010, and up 539% from 2000.

• The top export categories were: Machinery, Miscellaneous Grain, Seed, Fruit (soybeans), Electrical Machinery, Vehicles, and Aircraft.

• U.S. exports of agricultural products to China totaled $18.9 billion in 2011, the 2nd largest U.S. Ag export market.

• Top categories include: soybeans, cotton, hides and skins, and coarse grains.

Imports• China was the United States= largest

supplier of goods imports in 2011.

• The five largest import categories in 2011 were: Electrical Machinery, Machinery, Toys and Sports Equipment, Furniture and Bedding, and Footwear.

• U.S. imports of agricultural products from China totaled $4.0 billion in 2011

• Top categories include: processed fruit and vegetables, fruit and vegetable juices, snack foods (including chocolate), and spices.

Trade Balance

• The U.S. goods trade deficit with China was $295.5 billion in 2011, an 8.2% increase ($22.4 billion) over 2010.

• The U.S. goods trade deficit with China accounted for 41% of the overall U.S. goods trade deficit in 2011.

• The United States has a services trade surplus of $13.4 billion with China in 2011 (preliminary data), up 20% from 2010.

Foreign Investment

• U.S. foreign direct investment (FDI) in China (stock) was $60.5 billion in 2010 (latest data available), a 21.4% increase from 2009.

• U.S. direct investment in China is led by the manufacturing and banking sectors.

• China FDI in the United States (stock) was $3.2 billion in 2010 (latest data available), up 171.6% from 2009.

• China direct investment in the U.S. is led by the wholesale trade sector.

U.S.A and China Trade History

• In 1784, when the American War for Independence was barely over, the first ship to sail under an American flag left New York for China.

• Ship Named “Empress of China”

Why China?

• After Revolutionary War the British refused to work with Americans.

• Most of Europe practiced mercantilism – closed trading networks.

• Navigation act of 1651.

• Demand for Chinese products continued after Revolutionary War.

• Young nation eager to make Profits.

First Trades

• Chinese preferred to work with Americans.

• Tea, porcelain, silk, and nankeen were China’s initial exports.

• Tea became the dominant commodity, expanding from approximately 36% of the total imports from China in 1822 to 65% in 1860.

• Americans had difficulty finding a commodity that would balance imports from China.

• America’s main export was specie (metal & coins)

Rise of Communism in China

• China and American trade continued under “open door” policy until 1949.• For twenty years the United States

cut off trade and orchestrated an international embargo of China due to communist rise.• With America seeking to bring an

end to the Vietnam war unofficial relations began again in 1972.

1972- Present

• Full diplomatic ties established.• Rapid increase in trade and

development with China’s reform and opening policies.• United States imports rose from

$4.7 million in 1971 to $1.3 Billion dollars in 1980.• Steady gross number of imports

from China to America has continued since