Trade protectionism harms all

The trade dispute over automobile parts and tires between China and the United States shows that the foreign trade environment for China is likely becoming worse, says an article in China Business News. Excerpts:

Trade frictions between China and the US are not new. Statistics show the US initiated 67 investigations and anti-dumping actions against China's exports in 2011, involving $5.9 billion.

Trade protectionism has prevailed during the global financial crisis. China, one of the largest exporters, naturally has become the main target of protectionism.

In fact, domestic politics in the US plays a leading role in China-bashing on trade issues. This shortsighted practice harms the economic interests of both sides in the long run, with US consumers paying higher prices for products that used to be made in China.

More importantly, many exports to the US from China are produced by US or other foreign companies. They gain a large proportion of their profits from this. The trade balance between the US and China would not be that rosy for China if the profits of the foreign companies were subtracted.

The US is going in the opposite direction of the trend of globalization. Chinese enterprises should have the consciousness to be ready for challenges from the US side that may last for a long time. They should take all possible steps to defend their legal interests.