Op-ed “opposite the editorial page” My take on China & US trade:
First we need to know that Xi Jinping, General Secretary of the Communist Party of China, started on March 14, 2013, On Mar 11, 2018 – China Removes Presidential Term Limits, Enabling Xi Jinping To Rule Indefinitely.
I think the move represents the end of China’s 40-year-long reform era, and what is going to be the Xi and China’s ambitions to take on US as a leader and the sole superpower. The two-consecutive-term limit to China’s presidency was put in place by Chinese leader Deng Xiaoping in 1982 “in order to avoid the kind of chaos and tumult that can sometimes happen when you have a single authoritarian leader
Under communist party directed planned economy, Chinese state-owned enterprises and state capitalism prince-lings gain the most benefits in most activities including the Belt and Road Initiative and Made in China 2025. The U.S., Japan, Canada, Mexico, E.U. countries do not recognize China as a market economy, alleging market distortions. Therefore China’s industrial policy is aimed at rapidly expanding its high-tech sectors and developing its advanced manufacturing base.
Many Economists states that China’s centrally directed economy with its goal to preserve communist party control of the politics and economy is relevant to U.S. trade policy a lot of professional and professors that I have spoken to also said the communist party regime has expanded its use of state-directed, market-distorting, mercantilism policies, especially since 2008
The standard line of those who support the get-tough approach toward Beijing is that because China sells more to the U.S. than the other way around, therefore Washington has the upper hand in its game of tariffs.
Statistically, it might be right: The U.S. exported only $120 billion worth of goods to China in 2018, compared with the $540 billion it imported. However, make no mistake that is not the only upper hand there are many other tools we have, and we are service base economy and China is industrial economy, therefore the amount of damage it can inflict on the American economy and business through tariffs is much more limited.
According to US Census Bureau, American exports to China in the first quarter of 2019 dropped by 19 percent from the same period a year earlier, while China’s exports to the U.S. have fallen 14 percent.
THE KEY POINTS
· Chinese Premier Li Keqiang, in his opening remarks at the annual National People’s Congress, announced cuts in taxes and fees worth nearly 2 trillion yuan ($289.28 billion).
· Li also said monetary policy will neither be too tight nor too loose and pledged to keep exchange rate of the Chinese yuan stable.
· The Chinese government budget deficit in 2019 is expected to widen to 2.76 trillion yuan, representing around 2.8 percent of the country’s gross domestic product, Li said.
· China Inflation Rate Rises to 6-Month High
· China April Trade Surplus Far Below Estimates
· China Quarterly GDP Growth Weakest in 3 Years
One might ask, what is China 2025?
Released in 2015 by Xi speech, Made in China 2025 is the government’s ten year plan to update China’s manufacturing base by rapidly developing ten high-tech industries. Chief among these are electric cars and other new energy vehicles, next-generation information technology (IT) and telecommunications, and advanced robotics and artificial intelligence. And The Belt and Road Initiative (BRI) is:
It is a global development strategy adopted by the Chinese government involving infrastructure development and investments in 152 countries and international organizations in Asia, Europe, Africa, the Middle East, and the Americas. “Belt” refers to the overland routes for road and rail transportation, called “the Silk Road Economic Belt”; whereas “road” refers to the sea routes, or the 21st Century Maritime Silk Road.
It was known as the One Belt One Road (OBOR) the Silk Road Economic Belt and the 21st-century Maritime Silk Road.
Well until 2016 when the Chinese government considered the emphasis on the word “one” was prone to misinterpretation.
The Chinese government calls the initiative “a bid to enhance regional connectivity and embrace a brighter future”. Some observers see it as a push for Chinese dominance in global affairs with a China-centered trading network. The project has a targeted completion date of 2049, which coincides with the 100th anniversary of the People’s Republic of China, this initiative with a combined Gross Domestic Product of $23 trillion and includes some 4.4 billion people in the world.
The cash reserve for both countries are :
· China’s foreign-exchange reserves in US $3.11 trillion.
· Our foreign-exchange reserves is approximately $1.70 trillion.
The Fights goes on, to take over the next generation of communication Technologies and 5G :
· The Chinese telecom giant Huawei Technologies
· The US telecom giant Qualcomm Technologies
The problem I see and my research shows Apple is aggressively trying to kill Qualcomm.
One might ask what is the 5G?
‘5G’ Is an Umbrella Term for Two Sets of Frequencies
One of the most intuitive elements about 5G naming is that it is actually covers two very distinct sets of frequency bands.
Kambiz Merabi May 16, 2019 Los Angeles