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US- China trade shows ongoing improvement

Xinhua | Updated: 2016-12-12 09:44

BEIJING - Trade between the world's two largest economies has shown signs of improvement as the US trade deficit with China, a long-term US concern, narrowed significantly in October.

In October, US exports to China reached a three-year high of $13 billion, contributing to the month's 4.2 percent decrease in the trade deficit with China, according to the US Commerce Department.

The US overall trade gap for the month grew 17.8 percent, the biggest increase since March 2015, to $42.6 billion from the surprisingly low September deficit, data from the department showed.

China's measures to promote steady economic growth have contributed to the growing consumer appetite for US imported goods, said Bai Ming, researcher with an institution affiliated with the Ministry of Commerce.

Chinese figures show that the nation's trade surplus with the US has been growing since 2000, reaching $42.1 billion in 2002 and surpassing $200 billion in the January-November period of this year.

The growth has slowed in recent years, with just a 0.9 percent year-on-year increase in the first eleven months of this year, largely due to improvement of the trade balance between the two countries, experts have said.

With the transfer of processing trade, the main source of trade surplus between China and the United States, to other regions such as Southeast Asia, the trade gap between the two countries has narrowed in recent years, said Zhang Yansheng, head researcher with the China Center for International Economic Exchanges.

Customs data show that China has been the world's second largest importer for seven consecutive years, with its imports standing at $1.68 trillion in 2015.

The nation's total imports are expected to reach $8 trillion in the next five years.

In the first eleven months, China's overall trade surplus narrowed to 3.11 trillion yuan ($457 billion), down 5.8 percent from the previous year, latest customs data show.

China is pursuing an overall trade balance rather than addressing its trade imbalance with any particular country, experts have said.

During US President-elect Donald Trump's campaign trail, he promised to bring back lost manufacturing jobs by renegotiating free trade deals and levying hefty tariffs on trade partners.

Though the remarks were aimed at appealing to voters, they show the growing tendency of protectionism in the United States, which will hurt itself as well as its trade partners, Bai said.

Trade between China and the United States reached $558.4 billion in 2015, hundreds of times greater than in 1979 when China-US diplomatic relations were established. The United States has become China's second largest trade partner while China is the US' largest trade partner.

China-US trade rose at an average annual growth rate of over 7 percent in recent years in defiance of the global downturn after the 2008 financial crisis.

US goods and services, including 22 percent of its cotton, 26 percent of Boeing airplanes and 56 percent of its soybean, were sold to China, creating nearly a million jobs for the exporter.

For a long time, US exports to China were mostly primary goods and agricultural products, but not products where the United States had a comparative advantage such as high-tech products, Zhang said.

To narrow the US trade deficit with China, the United States should relax its restrictions on the export of high-tech goods to China, and combine its technology and experience with China's competitive equipment and industries, Bai said.

The two sides can also jointly develop the third-party markets and continue to promote trade in services, which will help balance bilateral trade, Bai added.

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