Economy, Foreign Trade
American tariffs, chief sources, Chinese exports, trade restrictions, major imports
China’s foreign trade is controlled mainly by state-owned trading corporations at the national and local levels. Since 1979, local corporations have gained increasing autonomy in their foreign trade decisions. The state has relaxed some trade restrictions, which has attracted foreign investment and increased trade activity. Chinese companies that partner with foreign companies can import equipment and raw materials for their own use and can export their products.
In 2000 Chinese exports totaled $249.3 billion, and imports totaled $206.1 billion. Chief exports included clothing, accessories, and footwear; textiles; petroleum and petroleum products; and telecommunications and sound equipment. Among the major imports were machinery, steel products and other metals, automobiles, synthetics, agricultural chemicals, rubber, wheat, and ships. Principal purchasers of China’s export goods are Hong Kong (which is part of China but has a separate economy), the United States, Japan, South Korea, Germany, Singapore, The Netherlands, and the United Kingdom; chief sources for imports are Japan, Taiwan, the United States, and South Korea.
China’s trade relations with the United States were periodically strained in the 1990s as a result of American criticism of China’s human rights practices. Several times the United States threatened to suspend normal trading status, formerly called most-favored-nation trading status, for China. With normal trading status, American tariffs on imported Chinese goods are similar to the tariffs the United States imposes on goods from most other countries. Without normal trading status, the tariffs would be much higher, and the price of Chinese goods would be higher for American consumers, which would likely cause a decrease in the volume of trade between the two countries. However, after China agreed to reforms designed to open a wide range of industries to international competition and investment—such as reducing tariffs and other barriers on imports of many U.S. industrial and agricultural products—the U.S. Congress in 2000 passed legislation giving China permanent normal trading status. Many experts believed that normalizing trade with China would foster cooperation instead of confrontation, and would therefore help strengthen support for new environmental, labor, and human rights reforms within China.
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