Studying Of China And USA Trade Friction

Since the reform and opening-up, the economy of China has been developed substantially. Especially in the 21st century, the economic growth is steady. In the course of economic development, China's foreign trade development plays an important role in promoting the national economy, and the dependence on our foreign trade is gradually improving. China has become a truly great foreign trade country. The development of foreign trade has strongly impacted on both our own and the world economy pattern.The United States plays an important role in the course. The United States is the second largest trading partner of China, and the largest export market and the trade surplus country, and the fifth largest direct investment country as well. Therefore, the relationship has become the focus between China and the United States. As the trade friction increasing recently, how to handle it has become the most important thing. There are some differences and advantages on the development and the structure between China and the United States in the 30 years. China is the largest textile-producing and exporting country in the world. The textile industry develops rapidly and plays an important role in our national economy. Hereby, the friction in textile trade has become the typical problem. As the economic developing, it mainly focuses on the intellectual property, trade imbalance, and the RMB exchange rate and energy security as well. The main reason of the trade friction between China and the United States are the changeable international economic environment and the problems on the economic development of China. It is an enormous impact on both China and the United States. Facing the friction positively, it would help us to handle the relationships between China and the United States by adjusting the trade structure and understanding relative mechanism.The cargo trade in China tends to optimize the overall structure and close to the international division of the labor network. However, it doesn't mean that we have an advantage in the technology and capital-intensive industry, and we still rely on importing in some key technology and core components. Therefore, we must dedicate to the scientific research and development on high-tech industries, and optimize the structure of our cargo trade. On the other hand, the total value on import and export of our service trade was only 191.748 billion U.S dollars till 2006, while it was 765.439 billion U.S dollars in USA and we was far less than USA. Our service exports are low value-added labor-intensive industries, while imports are mostly high value-added knowledge and technology-intensive industries. The trade surplus on Service between USA and China has been growing rapidly in recent years, and it has been around 2 billion U.S dollars since 2000. It was expanded to 2.573 billion U.S dollars in 2005.China is the largest country in textile and apparel producing and exporting in the world, and it plays an important role in the national economy as the industry developing rapidly. The trade between China and the United States has the following characteristics: 1. the processing trade is nearly 70%, and the United States is the main beneficiary. 2. the"migration effect"is very important, and many enterprises which export to the United States have moved to China. 3. the most high-tech products are produced by foreign enterprises and the main reason is that the large American companies control the key components of high-tech industry.Due to the above analysis, we can indicate the following aspects on trade friction between China and the United Sates: 1. the intellectual property problem and the protection of intellectual property will be the major focus in the relationship of economic trade between the two parties. 2. the trade imbalance problem and China is the largest trade deficit country of the United States. 3. the RMB exchange rate problem and the lower-estimated of RMB exchange rate is the biggest problem to result in the trade imbalance, and the United States accused China to"manipulate"RMB exchange rate. In fact, it has little effect on the trade imbalance. 4. the energy security problem and the demand of energy grows rapidly and becomes the essential force on international energy market and energy politics in China. The United States has doubt on our energy diplomacy.There are two focuses on the reason of the trade friction between China and the United States. On the one hand, the return of the international trade protectionism which is the external factor and the United States regards China as a"non-market economy country"and takes discriminatory trade policies. On the other hand, the surplus of the domestic productivity increases the export pressure due to the insufficient domestic demand. Meanwhile, Chinese enterprises want to expand foreign markets with low price and they believe the traditional philosophy on"small profits but quick turnover"and as well as the long-term export subsidies by Chinese government.How to solve the problem of trade friction between China and the United States is the chief mission of Chinese foreign trade. We should start with the following aspects: 1,we should guard against circumvention of the trade risk under the present multilateral trading system, and draw together with developing countries and weaken the strength the United States. We should also understand the scope of WTO dispute settlement mechanism and enhance the competitiveness of export industries and improve the environment for domestic industries and set up industrial security early warning mechanism, and make the industry associations to undertake their duty.2,A correct understanding of China and USA Trade friction. The China and USA Trade friction should be prudentially treated with rational thought and ordinary mood. Also strengthening communication, promoting mutual understanding is needed. To handle the escalating trade friction between China and the USA rationally should be fully aware of the necessity and long-term that in the contemporary international political and economic background. We should strengthen inter-governmental dialogue and coordination between relevant government departments. Through with communication and consultation of the emerging differences and contradictions, the mutual benefits between the two sides finally reach consensus, furthermore the emergence of friction is reduced and prevented. 3, To improve the China and USA trade structure. Our country must step up industrial restructuring, promoting industrial upgrading, and improve international competitiveness, and achieve by trading power to trade power changes. In addition, to accelerate the development of the service sector is the way to reduce the trade deficit Service. To adjust the pattern of foreign trade can promote foreign trade market diversification, diversification.