|A Chinese woman tests the new iPhone 7 during the opening sale launch at an Apple store in Shanghai on Sept 16, 2016. (Johannes Eisele / AFP)|
WASHINGTON – The US-China economic relationship nowadays supports roughly 2.6 million jobs in the United States across a range of industries, according to a new report released by the US-China Business Council on Tuesday.
The report, based on a study conducted by Oxford Economics, said China has become the third-largest purchaser of US-made products and services after Mexico and Canada, buying goods and services worth US$165 billion in 2015 alone, accounting for 7.3 percent of all US exports.
In 2015, US exports to China directly and indirectly supported 1.8 million US jobs, and US investment in China supported another 688,000 jobs while Chinese investment in the US supported about 104,000 jobs, the report estimated.
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"When the economic benefits generated from US investment in China and Chinese investment in the United States are combined, the total amounts to 2.6 million US jobs," the report said.
During last year's election campaign, the negative impact of trade with China, such as estimates of jobs lost, received considerable attentionJohn Frisbie, President, US-China Business Council
As the size and purchasing power of the Chinese middle class continues to grow over the next decade, the report expected US exports to China to rise to about US$369 billion by 2026 and more than US$520 billion by 2030.
The report noted the impact of US-China trade deficit was frequently overstated as many of Chinese exports comprise foreign-produced components and the contribution of US service exports to China is often overlooked when tallying the balance of trade.
"When these points are factored in, the US deficit with China falls from 2 percent to just 0.8 percent of US GDP – less than the US trade deficit with the European Union," the report said.
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Chinese manufacturing products also helped lower prices of consumer goods in the US, dampening inflation and putting more money in American wallets, according to the report.
"At an aggregate level, US consumer prices are 1 percent-1.5 percent lower because of cheaper Chinese imports. The typical US household earned about 56,500 dollars in 2015; trade with China therefore saved these families up to 850 dollars that year," the report said.
John Frisbie, president of the US-China Business Council, said the US presidential election last year presented a distorted view of the impact of US-China economic relationship on the US economy, and this report would provide a sound basis for such policy discussions.
"During last year's election campaign, the negative impact of trade with China, such as estimates of jobs lost, received considerable attention. In most cases, the presented data fails to provide a balanced assessment that incorporates the positive effect of the commercial relationship with China," Frisbie said.
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"Presenting only the negative impact and ignoring the jobs created, lower inflation, and other benefits of trade with China can lead to policies based on incomplete or misleading information," he added.
The report came after US President-elect Donald Trump formulated a trade policy team that might take a tough stance against China. Chinese leaders have emphasized that cooperation is the only correct choice for the world's two largest economies.