Current Status and Future Prospects
of Sino-US Economic and Trade Relations

The bilateral trade between the People's Republic of China and the United States of America has been developing rapidly since the two countries established diplomatic relations in 1979. In China's statistics, the bilateral trade volume in 1979 was 2.45 billion dollars only. In 1995, the volume reached 40.83 billion dollars, more than 16 nines of tile figure 16 years ago. The United States is now the third trade partner of China. China and The United States are two important nations in the world. China is the biggest developing country while the United States is the biggest developed country. The two economies are very complementary to each other. The United States has a huge market, strong purchasing power and diversified consumption structure and consumer mix. Chinese products, including consumer goods such as textiles, garments, footwear, toys, household electric appliances and other light industrial products and tools and general machinery, are well received here for their quality and reasonable price. In the meantime, China has a great growing market for advanced technologies, equipment and other productive materials and certain commodities, in which the American aircraft, sophisticated machinery, electronics, chemicals, grain, timber and fertilizer are taking a remarkable share.

The complement and size of the Sino-US markets leave the bilateral trade with great potential to be tapped, which could be greater with China's economic growth.

Concerning American investment in China, there has been 15,000 projects approved by the end of last year, involving 18 billion dollars in contractual value and 7 billion of paid-ins. You may find American invested projects in more than twenty of China's provinces in a wide range of fields, such as machinery, metallurgy, oil drilling, electronics, telecommunications, chemicals, energy, textiles, light industry, agriculture, pharmaceuticals, restaurant, tourism and real estate. More than 80 of the Fortune 500's top American companies, like IBM, GE, Du Pont, Chrysler, Ford, AT&T, Motorola and UTC, etc., have all set up their operations in China. With the exception of Hong Kong and Taiwan, the United States is now the biggest investor in China and the enthusiasm of American entrepreneurs seems stronger day by day. It is predictable that more and more American companies are going to China to search for partners, explore opportunities and share the growth of its market.

Nowadays, trade with China creates hundreds of thousand jobs in the United States while trade with US creates even more jobs in China. So, it is to the interest of the two peoples to develop economic and trade relations between China and the United States on the basis of equality and mutual benefit, no matter how you may measure it.

In May of 1994, President Clinton decided to renew the Most-Favored-Nation treatment to China in 1994-1995 and de-linked MFN from human rights issue. That decision proved to be conducive for a later remarkable improvement of the bilateral economic and trade relations.

China and the united States also share concerns on such issues as trade unbalance, market access, antidumping, prison labor products, as well as American export restrain, service trade, and protection of intellectual property rights. The two sides have reached mutual understanding on some of these issues while making efforts to tackle the pending. It is normal for such big countries as China and the United States to have this or that differences and disputes, and problems can be solved through friendly negotiations as long as both sides have political sincerity and the spirit of seeking truth from facts. If artificially imposed obstacles could be removed, people should have every reason to be optimistic about the future economic and trade relations between China and the United States.

This article is brought to you courtesy of Ms. Xue-chun Shan, Commercial Consul at the Consulate General of People's Republic of China in Los Angeles.

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