First point: U.S. trade deficit falls 7.6% in October to 16-month low on decline in Chinese imports. (12/5/19)
Second point: US – China Trade War: Chinese Exports To US Fall 23% Amid Tensions Between Washington, Beijing. (12/10/19)
Third point: Chinese official says Beijing wants US trade deal ASAP. (12/10/19)
Fourth Point: Firms Withdraw From China On Worsening Business Conditions. (12/10/19)
“A growing number of companies from Korea and other countries are pulling their production out of China due to worsening business conditions sparked by the prolonged tension between the United States and China coupled with rising operating costs there. They are moving to the ASEAN market as the 10-nation economic bloc with its young population and cheap labor costs has been emerging as the world’s new manufacturing hub replacing the Chinese market.”
I would be surprised if any of the Groksters, at a fundamental level, wouldn’t be free traders philosophically. It would be lovely to not have to pay higher prices and all trade was voluntary. The problem is that you have to have both sides agreeing to that item – and not a lot of our trading partners have, especially China.
I, for one, am glad to see Trump having the trade war. It’s been more than a few months but it does seem that it is starting to have results. Again, war by other means can certainly mean trade and the effect Trump’s policies is having on China’s economy is significant. He’s the only President in modern times to have realized that to beat their rising military was to co-opt their economy BEFORE it came to a hot war.
Once again, we’re winning (at least thus far), Cold War II. I can’t remember where but it seems like China, even as it is building up its navy, is having second thoughts on the militarization of the islands (some under contention by other countries that claimed them as theirs) in the South China Sea – on some, the pouring in of military money is drying up. Hong Kong hasn’t helped the Communist Party leadership as HK’s push to keep their democracy and rights from the agreement with Great Britain ceding it to the Commies is spreading to other areas. The Chinese are also having massive problems with the “host” countries with their Belt and Road initiative that the onerous agreements are now working to disfavor China.
The worst for China, overall, is the Second Point. When all those logistics and supply chains up and move, they aren’t going to come back any time soon. China has shown itself to be a bad partner – and who wants to stay with companies like that?