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Earlier this week I wrote about the gap between the US import data from China and the Chinese data on exports to the US. In August, these Chinese data showed a 20% y/y increase in exports to the US -- while the US import data was flat
https://www.cfr.org/blog/record-chinese-bilateral-surpluses-united-states-are-not-mirrored-us-trade-data
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https://www.cfr.org/blog/record-chinese-bilateral-surpluses-united-states-are-not-mirrored-us-trade-data
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I looked at this a bit more formally by taking the ratio of China's exports to the US to US imports from China, with both as a trailing 3m sum.
Historically, China's exports are below those of the US -- and pre-trade war, they were generally ~ 85% of US imports.
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Historically, China's exports are below those of the US -- and pre-trade war, they were generally ~ 85% of US imports.
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Obviously that has changed -- China is now more reporting substantially more exports to the US than the US does imports, and a bigger surplus with the US than the reported US deficit with China.
What's more, the same change hasn't taken place vis a vis the EU
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What's more, the same change hasn't taken place vis a vis the EU
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This is a reasonably large data gap -- one that matters for assessing say the elasticity of China's trade with respect to the tariff, as well as assessing the impact of the tariff on the bilateral balance!
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Two possible explanations for the discrepancy:
1) Chinese exporters are inflating their export receipts (a way of getting $ into China, it implies more inflow pressure and a smaller "true" Chinese trade surplus ...
or
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1) Chinese exporters are inflating their export receipts (a way of getting $ into China, it implies more inflow pressure and a smaller "true" Chinese trade surplus ...
or
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2/ US importers are understating their imports from China (and attributing imports to other locations) so as to minimize their tariff bill ...
I would bet on 2) but who knows ...
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I would bet on 2) but who knows ...
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in any case, the numbers on one of the biggest bilateral trade flows in the world have stopped adding up ...
something relatively big is going on. a 20 percentage point gap in the y/y data is quite unusual
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something relatively big is going on. a 20 percentage point gap in the y/y data is quite unusual
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here is a chart showing the monthly data for both sides over the last 20 months ...
in 2019, the US generally reported more imports than China exports. Not so in recent months.
in 2019, the US generally reported more imports than China exports. Not so in recent months.
