De-Risking or Decoupling? China- US Bilateral Trade Falls More Than 10% This Year

Economy MARKET_WATCH

Analysts have criticized the new ‘de-risking’ strategy that the U.S. is currently using against China, explained by U.S. National Security Advisor Jake Sullivan in April, clarifying that national security was over economic costs. 

 

These de-risking policies might affect bilateral trade, which fell by 11.2% to $217.9 billion during the first four months of 2023. ‘De-Risking’ Is a Euphemism for Decoupling U.S. and China Relations, Analysts State Analysts are criticizing the ‘de-risking’ strategy of the US against China. The term, which was mentioned by the U.S. National Security Advisor Jake Sullivan last month, is used to explain the position that the U.S. is adopting in front of the growth and policies of China on the Russia-Ukraine conflict.

 

And while U.S. Treasury Secretary Yanet Yellen has previously stated that a full decuple of the economies of the two countries would be “disastrous,” Chinese analysts believe that this is just a semantics choice. Zhou Xiaoming, a senior researcher at the Centre for China and Globalisation, has stated that this ‘de-risking’ strategy has ‘nothing short’ of decoupling in action, as it seeks to limit the economic interaction with China to just the necessary. Xiaoming explains: The U.S. will continue to trade with China as it has learned that totally cutting economic ties between the two is neither feasible nor desirable. Nevertheless, the Biden administration still appears intent on building a “small yard” with a “high fence”. 

 

This approach would be responsible for the inclusion of more Chinese companies in the called ‘entity list’ of the Office of Foreign Assets Control (OFAC), and the recent tightening of the export controls on chips to China, but might expand to other fields in the future, Xioaming states. Possible Effects on Trade Xiaoming believes that this de-risking strategy seeks to also undermine the relations that China has with the world, stating that ‘Washington clearly sees decoupling as critical to its strategy of reducing China’s economic ties with the rest of the world.” However, this might also be affecting American consumers and companies. 

 

According to the General Administration of Customs of China, bilateral trade has fallen by 11.2% year over year during the first four months of 2023, after having registered a $690 billion record in 2022. The European Union (EU) has also recently proposed to de-risk its relationship with China, facing a strong answer from Foreign Minister Qin Gang, who stated: China does not export its system, and it follows a path of peaceful development, pursues a mutually beneficial strategy of opening up, stays true to and safeguards the international order underpinned by international law, and opposes hegemonic, domineering and bullying practices. What do you think about the de-risking strategy applied by the U.S. government against China? Tell us in the comments section below. 

 

Source : [De-Risking or Decoupling? China- US Bilateral Trade Falls More Than 10% This Year](news.bitcoin.com/de-risking-or-decoupling-china-us-bilateral-trade-falls-more-than-10-this-year/) by Sergio Goschenko - 35Bitcoin News by Sergio Goschenko / May 15, 2023

Automata FRANCE SAS

240 rue Evariste Galois,

06410 Biot,

Sophia Antipolis

Automata Pay

65-66 Warwick House 4th

Floor, Queen Street, London

England, EC4R 1EB

Automata ICO Ltd

3rd Floor Ormond Building,

31-36 Ormond Quay Upper,

Dublin 7, D07 Ee37

Automata Pay Europe Ltd

3rd Floor Ormond Building,

31-36 Ormond Quay Upper,

Dublin 7, D07 Ee37

Automata ICO Ltd

Italian Branch

Via Archimede, 161,

00197 Roma

Italy

Automata ICO Limited, a Company incorporated in Ireland with its registered office at 3rd Floor Ormond Building, 31-36 Ormond Quay Upper, Dublin 7, D07 Ee37, Ireland registered in Ireland under number 690280 has applied for a Virtual Asset Service Provider registration with the Central Bank of Ireland. Whilst the application is ongoing, we are permitted to continue business as a Virtual Asset Service Provider in line with the Central Bank of Ireland's regulatory disclosure statement as required under section 106L of the CJA 2010 in relation to registered VASPS.

Automata ICO Limited, a Permanent Establishment incorporated in Italy with its registered office at Via Archimede, 161, Roma, Italy, and registered in Italy under number 96550860587 with the Organismo Agenti e Mediatori (OAM) as a Virtual Asset Service Provider (VASP).

Automata France SAS is a company registered in France with the company number 902 498 617. Automata FRANCE SAS is registered with the french Financial Market Authority, l’Autorité des marchés financiers (“AMF”), as a provider of Virtual Asset Service Provider under number E2023-087.