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The Global Perspective of the U.S.-China Relationship

Posted on Sep 12, 2018

The United States and China have a relationship that is currently in flux and has undergone a lot of press in recent months, as President Donald Trump has threatened tariffs on Chinese goods exported to the United States, and the Chinese President, Xi Jingping has threatened to follow suit.

Despite this temporary downturn in the economic relations between the United States and China, globally speaking, this relationship has done a lot of good for both nations and the world in general.

How the U.S. Benefits from Positive Relations with China

Much of the negative press coming out of the U.S. and Chinese relationship is due to the trade imbalance with the United States buying a lot more goods and services from China than vice versa (though China does import significant amounts of agricultural products like soybeans from China).

The trade imbalance is misleading in a lot of ways. China holds a significant amount of U.S. dollars which allows the U.S. to finance their debt cheaper than they would otherwise be able to and helps to finance a significant portion of the infrastructure build in the country. This helps to support the U.S. economy and build jobs.

Further, Americans are able to buy goods at significantly cheaper prices than they would without trade with China. The cheap goods received in the United States allow the nation to purchase other goods produced by Americans and also allows the American economy to specialize in other industries and professions that can add more value to the country, such as those in financial services and technology engineering, and which can lead to economic benefits around the world. American inventions have furthered the expansion of global standards of living and has led to growth in the world ecomy..

How the China Benefits from Positive Relations with the United States

There are a lot of people in China and these people need jobs and income to live. Trade with the United States has helped to support the growth in jobs in China and has led to a better overall standard of living in the country.

China has grown their economy in many ways due to trade with the United States and has started to use their newfound wealth to build ecologically friendly industries and source of power that contribute to the world.

How the Rest of the World Benefits

The growth of wealth in China has led to rising living conditions in the country, but also in other parts of the global world. Southeast Asia trades frequently with China and has benefited in the growth of the U.S. economy. Countries like Vietnam, Burma, and South Korea have all benefited from China and U.S. trade relations.

Africa has experience economic growth from investment by Chinese investors who are helping to build up the African economy and improve on their standard of living.

U.S. and Chinese economic relations therefore have a lot of ancillary benefits that raise the global economy and are essential for future prosperity.