Analysis Of China's Colossal $878 Billion Trade Surplus

[beijingwalker]

Analysis Of China's Colossal $878 Billion Trade Surplus​

Why *everything* is Made In China​

SHIVANI

2023年5月16日

As one of the world's largest economies, China has become a major player in global trade. Today we’re taking a deeper look at China’s colossal $878 billion trade surplus.

Trade balances

A country’s trade balance represents the difference in its exports and imports of goods and services. ​

• A trade surplus is a positive trade balance, where exports > imports.
• A trade deficit is a negative trade balance, where imports > exports.

Let’s take a look at trade balances around the world.



China was the clear leader in trade in 2021, with a $463 billion trade surplus. Meanwhile, the USA has the largest trade deficit worldwide at -$845 billion. Furthermore, the USA’s trade deficit is over 10 times the size of the next-largest trade deficit, belonging to India. That’s a lot of debt!

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China everyone else
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So whats behind China’s huge trade surplus, and the USA’s even huger trade deficit?

In 2022, China’s imports totalled $2.71 trillion, and exports $3.59 trillion, leaving it a hefty $878 billion trade surplus.

It’s no surprise that the USA is China’s largest customer, importing $582 billion worth of goods and services from China in 2022.

The chart below shows China’s other global partners for imports and exports.



Thank you to our friends at Visual Capitalist for the inspiration for this design!

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Why is everything made in China?
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China’s extensive infrastructure, including a robust supply chain and specialised labour force, make it an ideal location for producing goods quickly and efficiently. With a large population and low labour costs, China is the global epicentre of manufacturing, appealing to companies looking to cut costs and boost profits.

Additionally, the Chinese government has implemented policies to encourage foreign investment and manufacturing, such as tax incentives for companies that set up operations in the country.

Many large companies, including Apple and Tesla, rely heavily on China to support their manufacturing.

China and the European Union
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The European Union (EU) is one of China's most significant trading partners.

China’s main exports to the EU comprise telecommunications equipment, machinery and electronic equipment.



On the other hand, China’s imports from the EU include motor vehicles and parts, electronic equipment and medications.



China's trade surplus with the EU has also been a subject of concern, due to the trade balance consistently skewing in China’s favour. To mitigate this, the EU and China negotiated the EU China comprehensive agreement on investment (CAI) in 2020, with the aim of creating a level playing field. Despite seven years in the making, the CAI was scrapped a mere 5 months following its negotiation.

Overall, as China’s trade surplus continues to boom, the country’s dominance in global manufacturing is showing no sign of slowing down.

Inside China's $878 Billion Trade Surplus

Why *everything* is Made In China

genuineimpact.substack.com

 

[beijingwalker]

In H1 2023, The growth is modest, we won't see that massive jump like the one happened last year, the overall global economy is in doldrums

 

[StraightEdge]

The data is secondary here, I liked the design of the article. I think I will use this format in some presentations.

 

[Communism]

A huge portion of the U.S.'s apparent current account deficit is simply due to companies running their profits through tax shelters like Ireland.

WHY MACRO IS BROKEN

Corporate data is more important than macro data now

www.russell-clark.com

The U.S.'s real current account isn't anywhere near as negative as it appears.

 

[hari sud]

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

 

[Communism]

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

Nonsense narrative.


The U.S.'s business relationship with China is the main reason why the U.S. economy hasn't crashed earlier.


The U.S.'s economic vitality in the last generation or two is due largely to the U.S.'s economic alliance with China.


The U.S.'s economy is already bearing the brunt of the tiny current amount of decoupling from China, as seen in the hyperinflation and massive labor shortage.

 

[PakFactor]

The data is secondary here, I liked the design of the article. I think I will use this format in some presentations.

Some people learn better with visual presentation; this allows them to absorb the information better than just text.

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

They did realize their mistake, but the Chinese rise would have happened anyway. Their national planning and mindset differed from the rest of the developing world.

Nonsense narrative.


The U.S.'s business relationship with China is the main reason why the U.S. economy hasn't crashed earlier.


The U.S.'s economic vitality in the last generation or two is due largely to the U.S.'s economic alliance with China.


The U.S.'s economy is already bearing the brunt of the tiny current amount of decoupling from China, as seen in the hyperinflation and massive labor shortage.

The trade war certainly had a lingering effect on the American consumer, giving a gut punch to its purchasing power. I believe it'll get somewhat worse over time.

 

[beijingwalker]

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

So the west didn't "open their market and give tech" to India and other countries? don't try to fool yourself, it's just normal business practice and the west made filthy load of money from China, you believe the west can enjoy this high standard of living without the help of China? Taking decades? does the west still have decades?

 

[Nan Yang]

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

Not entirely true.

Even as China GDP increased, United States GDP did not stand still but also increased.

Both side benefit from trade.
India should learn and open up and not hide behind tarrifs.

Tarrifs is like a double edge sword. It cuts both ways.

 

[SaadH]

Nonsense narrative.


The U.S.'s business relationship with China is the main reason why the U.S. economy hasn't crashed earlier.


The U.S.'s economic vitality in the last generation or two is due largely to the U.S.'s economic alliance with China.


The U.S.'s economy is already bearing the brunt of the tiny current amount of decoupling from China, as seen in the hyperinflation and massive labor shortage.

Hyperinflation had very little to do with decoupling with China, and was mostly driven by corporate greed, 60% of the inflation was chalked up to excess profits.

 

[Communism]

Hyperinflation had very little to do with decoupling with China, and was mostly driven by corporate greed, 60% of the inflation was chalked up to excess profits.

The reason why they can do that now is due to the exclusion of foreign competitors that would be able to mitigate that increase through competitive pricing.


You can see the stark difference in prices between products on U.S. websites and the same or similar products on Chinese websites.

 

[GreatHanWarrior]

It is West’s gravest error that they gave the Chinese the money and technology. They also opened their markets for duty free imports and worst of all they set the Dollar to Yuan rate in such a way that it favoured China. Hence Chinese exports multiplied by leaps and bound. Now that mistake has been realized and correction will take a decade.

Well, for 70 years, India didn't have any technology. Now all Indian technology is stolen from China!

Some people learn better with visual presentation; this allows them to absorb the information better than just text.



They did realize their mistake, but the Chinese rise would have happened anyway. Their national planning and mindset differed from the rest of the developing world.



The trade war certainly had a lingering effect on the American consumer, giving a gut punch to its purchasing power. I believe it'll get somewhat worse over time.

But without Chinese technology. India cannot even make cameras. don't trust any Indian. They are born liars. Their dirty genes are only suitable for lying.