(Washington) Lasting divorce or simple COVID-19 effect? China may not end 2022 as the United States’ largest trading partner, for only the second time since 2008, as a result of tensions of a rare intensity.
Foreign trade data for the whole year are not yet known, but those published in early January for November by the US Department of Commerce confirm it: imports of products from China are no longer at the same pace. .
Admittedly, 2022 should break the record for Chinese imports into the United States, but over the first eleven months of the year, the North American country will have imported more, in value, from the European Union than from the world’s second largest economy. .
Other than in 2019, when the trade war between the two countries was in full swing, that hadn’t happened since 2008.
“We have seen a realignment of globalization since 2018,” analyzes Robert Koopman, lecturer at American University, based in Washington.
“Companies are seeking to diversify their supplies in order to avoid Sino-American geopolitical tensions, the effects of the pandemic, but also disruptions caused by climate risks” in a specific geographical area, he explains.
After two years of decline, in 2019 and 2020, under the effect of the trade war and then the cessation of world trade with the pandemic, Chinese imports had nevertheless started up again in 2021, without however returning to their level. prior.
” Substitution ”
Above all, according to a study by the Peterson Institute for International Economics (PIIE) think tank, they have recovered at a slower pace than before the start of the trade war, unlike imports from the rest of the world.
“There is clearly a form of substitution taking place, from China to other countries. It is partly financed by Chinese investors, who relocate to Vietnam, for example, but not only. For many, these are multinationals that want to get closer to the American market,” says Mary Lovely, researcher at the PIIE.
At the CES techno show in Las Vegas in early January, a Chinese electronics company, Etech, did not hesitate to highlight its factories in Vietnam.
In constant progression for twenty years, Vietnamese exports have also experienced a real boost since 2018, with a multiplication by more than two in value, thus becoming one of the main trading partners of the United States. .
More broadly, imports from other Asian countries are growing strongly: Taiwan, South Korea and even Malaysia are gaining market share.
Decoupling?
But are these the first signs of a decoupling between the American and Chinese economies? The subject divides the experts, who still lack hindsight insofar as the full effect of the American tariff policy has been affected by the health crisis and its consequences on the world economy.
Americans, once the confinements were lifted, “spent a lot of money on products that are generally imported”, underlines Ryan Sweet, chief economist for the United States at Oxford Economics. But “now they spend more on services, which has an impact on the demand for goods and therefore imports”.
An opinion that is partly joined by Emily Benson, researcher at the Center for International and Strategic Studies, based in Washington, for whom “even if the pandemic is not over, economic actors and governments are starting to act as if it were the case and trade returns to normal levels”.
However, one of the consequences of the “reorganization of world trade” and the “geographical diversification […] is to see supply chains no longer starting in China, but in Southeast Asia or closer to the United States,” she adds.
At the same time, “laws like the IRA (President Biden’s great climate plan, editor’s note) or the Chips Act (which aims to bring part of the production of semiconductors back to the United States) show a real desire on the part of the Biden administration to accelerate decoupling with China,” underlines Robert Koopman.
However, the intertwining of the two economies is such that it seems complicated to achieve, even in a context of geopolitical tensions.
“Tensions are building between the United States and China,” admits Ryan Sweet, “but that doesn’t mean the United States will stop importing Chinese products. Over the long term, we will see a diversification of supplies, especially because manufacturers will no longer put all their eggs in one basket. »