The Bloomberg News article, with contributions from Jenny Leonard, Haze Fan, Miao Han, and Shuping Niu, discusses China’s offer to reduce its trade surplus with the U.S. to zero dollars by 2024. This offer would reconfigure the bilateral trade relationship between the United States and China, as China would have to significantly increase its imports from the U.S. in a “six-year buying spree,” (Bloomberg). Many policy makers believe that China must do even better if they want trade relations with the U.S. to improve, stating that the surplus should be scratched in as little as two years. Despite the positive aspects of this deal for the recently strained U.S.-China relationship, others believe that China’s shift in imports may hurt the world economy. In addition to this, it is unlikely that U.S. companies and farmers would be able to meet the newly increased demands of the Chinese. The article closes out by examining what the Chinese must do to accomplish this goal; China would have to increase import totals from $155 billion to approximately $200 billion in 2019 alone and $600 billion by 2024 (Bloomberg).
The Chinese would have to end its mercantilist relationship with the U.S., shifting towards a more liberal economic position to accomplish this goal of a zero-trade surplus. In international trade, mercantilists want to maximize exports while minimizing imports, which results in trade surpluses that favor the respective state. This policy opposes mercantilist objectives by drastically increasing U.S. imports into China, placing the U.S. at a trade surplus every year for the next five years. This type of liberalist agreement would decrease trade barriers and encourage cooperation between the U.S. and China. Cooperation would potentially resolve the economic conflicts highlighted by the Trump administration over the past two years and help China’s ailing economy. However, U.S. officials are skeptical of this deal and will most likely refuse the offer (Bloomberg).
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