Against a backdrop of high profile trade and investment disputes between the United States and China, American hydrocarbon exports to China are booming. U.S. energy commodity exports to China went from $2.6 billion in 2016 to $8.6 billion in 2017.
If you’ve lost track of how we got here, here is a handy quick guide to recent events unfolding in the ongoing U.S.-China “trade war”.
President Trump just announced $50 billion worth of tariffs and other penalties on China for its theft of intellectual property, technology, and trade secrets. China will not change its behavior absent external pressure — pushing back against the constant drain from Chinese IP theft is long overdue.
While President Trump believes China’s large trade surplus shifts the balance of power in a tariff war to the United States, China can respond by punishing U.S. affiliates, who are sitting ducks in a trade war.
Approximately one-third of the scrap recycled in the United States is exported. China is our largest customer.
The North Korean regime continues to amass missile and nuclear technologies, through a combination of global licit and illicit transactions. North Korea trades for currency, for fuel, and for military materiel to preserve its power. Will expanded sanctions choke off revenue for weapons programs, or will continued trade ties with China throw North Korea a lifeline?
If the Trump administration confronts China over unfair trade practices it will need to ignore handwringing from trade groups, but the action will still offer only half of a solution. It generally doesn’t help when you are losing a race to complain that your competitors are running too fast. To stay in the lead, you have to pick up the pace.
In 2016, American ranchers sold $6.3 billion worth of beef overseas, finding its way into traditional meat dishes from yakiniku in Japan to tacos al carbon in Mexico, and bulgogi in South Korea. And now, thanks to a new trade deal, they can sell beef to China too.
Confirmation of Robert Lighthizer as USTR is still pending but some of his views on China were revealed at his hearing. The WTO may not have all the tools needed to address China’s industrial policies so the Trump Administration may look for additional new ones.
Chinese New Year celebrations kick off on January 28. Despite slowing growth, Chinese consumers will goose their economy buying new holiday clothes, food and drinks for gatherings, and gifts for relatives for the holiday.