All along, under the influence of the global economic environment, trade between China and the United States has been a focal point of attention.

Recent data shows that the total trade between the United States and China has experienced an unexpected decline, which has caused concern for many people, whether it will have a significant impact on our export trade?

In fact, it is the United States that is feeling confused now.

Although the United States has attempted to implement a decoupling strategy, reality tells us that the United States still cannot escape its dependence on China.

1

With the continuous interest rate hikes in the United States, causing its own economic growth to have a more obvious problem. China's export trade to the United States has also faced a severe challenge.

In the first eight months of this year, China's trade with the United States decreased by 8.7% compared to last year, with exports to the United States falling even more, reaching 11.7%.

Now, the total trade between China and the United States accounts for 11.2% of China's total trade, making the United States our third-largest trading partner after ASEAN and the European Union.

Advertisement

Of course, this is not only a decline in China's exports to the United States, but also a decline in global exports to the United States.

In the first half of this year, U.S. tariffs fell by 10% overall, a decline that shows U.S. import and export trade is on the decline.This slowdown is not only reflected in trade with China but also evident globally. This implies that the U.S. economic growth has decelerated, and trade between other countries and the U.S. has also taken a significant hit.

However, Chinese-funded enterprises have found a way around this by increasing exports to the U.S. through the Mexican market.

This phenomenon not only highlights the flexible response capabilities of Chinese-funded enterprises but also reveals that the U.S. dependence on China has not decreased.

The U.S. has granted Mexico zero-tariff preferences in order to develop its manufacturing sector.

Behind this policy is the strategic consideration of U.S. companies to reduce costs and decouple supply chains. Mexico's geographical proximity and trade agreement advantages make it an ideal choice for U.S. companies.

However, what is even more remarkable is that the total trade volume between China and Mexico is also growing rapidly. This is because many Chinese companies have recognized the potential of the Mexican market and have invested in setting up factories there.

According to data, Chinese companies have invested in more than 1,000 projects in Mexico, covering various fields, including manufacturing, electronic products, automotive parts, etc. These companies have leveraged Mexico's low labor costs and tariff advantages to achieve exports to the U.S. market.

The strategy of Chinese-funded enterprises using the Mexican market to transport products to the U.S. has not only brought about export growth but also provided Chinese companies with broader development opportunities.

So, in essence, it is still Chinese-funded enterprises leveraging Mexico's low labor costs and tariff advantages to bypass the Mexican market and export products to the U.S.As a significant participant in the global economy, the United States has historically been a vital trade partner for China. In the past, the mid-to-low-end manufacturing sector held a crucial position in China, forming a complementary relationship with the American market, resulting in relatively large trade volumes.

However, with the rapid development of China's economy, the structure of Chinese goods has gradually evolved, with mid-to-high-end manufacturing increasingly taking the lead. This shift implies that the trade relationship between China and the United States has transitioned from one of complementarity to one of competition.

The rise of China's mid-to-high-end manufacturing has also led to changes in China's product export markets.

There is a growing demand for China's mid-to-high-end products in ASEAN countries and along the Belt and Road Initiative. These regions are experiencing rapid economic development, with increasing consumer capabilities and a significant appetite for high-quality, high-tech products. China's mid-to-high-end manufacturing sector is an ideal choice to meet this demand.

The Chinese government has recognized this opportunity and is actively promoting trade cooperation with ASEAN countries and those along the Belt and Road Initiative.

Through continuous market development, market penetration, and product development measures, China is exploring new markets and seeking more cooperation opportunities.

Currently, our trade policy is shifting mid-to-low-end manufacturing to countries in Southeast Asia and Mexico, which continue to sell to the United States.

Simultaneously, within China, there is a continuous effort to cultivate mid-to-high-end manufacturing, selling products to emerging markets and developing countries.