Wednesday, December 22, 2010

Interesting US-China Trade Developments

. Wednesday, December 22, 2010

I don't have a whole lot to say about this, except that whenever we discuss increasing the amount of research for green technologies, or consider subsidizing production or consumption of green energy, we almost never consider the fact that those policy tools often violate international trade law. That's not the purpose of this suit, which is intended to protect American steelworkers (again), but it is a very real implication.

I also found this interesting:

The United Steelworkers, which had protested the Chinese wind power fund as part of a larger, 5,800-page trade complaint it filed with the American government on Sept. 9, said the administration’s decision was only a first step in addressing a “vast web of protectionist policies” by Beijing.

5,800 pages? From just one union? Geez.

Here's the statement from the US Trade Representative.

Here's a strong claim (via IELPB) about the misleading way trade statistics are calculated:

A new reasearch paper calculates that because of the way trade statistics are calculated - the full value of an iPhone is considered an export to the U.S. from China by both countries, even though only about 1% of the value was created during the final assembly process in China - just the iPhone alone added almost $2 billion to America's trade deficit with China in 2009. The authors find that if a "value-added approach" was used to calculate trade statistics, the iPhone would have instead generated a $48 million trade surplus for the U.S. in 2009, instead of the $1.9 billion trade deficit reported using the conventional methodology. ...

[I]f trade statistics were adjusted to reflect the actual value contributed to a product by different countries, the size of the U.S. trade deficit with China—$226.88 billion, according to U.S. figures—would be cut in half.

I wouldn't worry so much about the actual numbers, and instead focus on the fact that the trade statistics, like many other common statistics, do not always do a good job of measuring what they are supposed to measure.


Interesting US-China Trade Developments
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