According to the latest data released by the U.S. Bureau of Economic Analysis and the U.S. Census Bureau on the 9th local time, the U.S. international trade deficit in November last year was $63.2 billion, continuing to maintain a deficit.
Among them, the main lag is the trade deficit in goods.
△ Screenshot of the official website of the U.S. Bureau of Economic Analysis
It's puzzling.
You know, since the Trump administration, trade has been a central issue in the White House.
In order to bring manufacturing back to the United States and minimize the trade deficit in goods, the United States has even gone so far as to launch a trade war against its major trading partners, including its allies. But the results were far from ideal.
△ "Visible Capital" website: The U.S. trade deficit in goods reached $1.31 trillion in 2022, a significant increase of 40% from $791 billion a decade ago (2012).
Who the "unfriendly friend" hurts
According to the analysis, the U.S. trade deficit has been high for many years, not only because the U.S. aggressive interest rate hikes have led to the strengthening of the U.S. dollar and affected exports, but also because the "America First" protectionist policies deliberately launched by the White House have failed to meet the strong growth of domestic consumer demand.
On the contrary, the maximum effect of these policies is only to harm others and themselves.
At the beginning of the new year, as the new U.S. battery procurement regulations officially came into effect, more and more overseas electric vehicle brands lost their eligibility for tax credits of up to $7,500.
△ Screenshot of Reuters report
This is another result of the Biden administration's benchmark protectionist industrial policy, the Inflation Reduction Act.
The Inflation Reduction Act, together with the CHIPS and Science Act and other American-style policies, make a big fuss about the industrial chain and supply chain in the field related to the green economy, trying to use the country's low energy costs and generous financial subsidies to return the advantageous manufacturing industry to the United States, which has long been hollowed out, so as to realize the so-called "reindustrialization" of the United States.
However, facts show that the "re-industrialization" of the United States has not yet been realized, but it has suffered a lot of allies.
Chris Burns, head of Australian battery materials producer Novonix, said in an interview with the Financial Times that the clean energy subsidies provided by the U.S. Inflation Reduction Act are attracting emerging technology companies from Europe to the U.S. market.
△ Screenshot of the Financial Times report
The Center for Economic Policy Research, a U.S. think tank, once released a research report entitled "Unfriendly Friends," pointing out that one of the main goals of the Inflation Reduction Act is to make the United States the first choice for new investment, promote productivity growth driven by technology investment, and form a comparative advantage over the rest of the world.
And "this will cause specific industries in the EU to suffer losses that cannot be ignored".
△ Screenshot of the report of the "Center for Economic Policy Research", a U.S. think tank
Europe is not the only one that has suffered.
Hardwick, a research scholar at the Crawford School of Public Policy at the Australian National University, and other experts pointed out that although the main purpose of U.S. industrial policy is to produce effects at home, it is affecting global supply chains, especially in Asia.
The article quoted a commentary from South Korea's "Hankyoreh Daily" as bluntly saying: "The United States is changing from a guardian of free trade to a disruptor. ”
△ Screenshot of the report of "Asia Times".
The article emphasizes that while the "Inflation Reduction Act" and the "CHIPS and Science Act" help the United States "decouple and break the chain", it also has an impact on Asian allies such as Australia, Japan, and South Korea.
For example, Japan: When the U.S. Inflation Reduction Act was introduced, Japan lacked a subsidy-eligible bilateral trade agreement with the U.S., so Japan's supply of electric vehicle parts may be affected by the Act.
South Korea, for example, is unclear to what extent South Korean EV and battery companies will enjoy the promised "benefits" of the United States, given that the Inflation Reduction Act requires the final assembly of electric vehicles to take place in North America.
And for the rest of the world, U.S. policy is "another step toward moving away from leadership in a functioning multilateral trading system."
△ Screenshot of the report of "Asia Times".
"'De-risking' itself is the biggest risk"
Relying on the means of protectionism that is easy to master, wantonly distorting the global industrial and supply chains for one's own selfish interests is not the patent of a certain US administration, but the unchanging creed of this hegemonic country.
In addition to offering all kinds of protectionist tools, American rhetoric under the guise of "national security" is also being renovated.
Since last year, "de-risking" has begun to replace "decoupling", which was once shouted by the Trump administration, and has become a new buzzword in the mouths of American politicians.
△ The New York Times: The "de-risking" argument may be more diplomatic than "decoupling."
In this regard, international public opinion generally believes that whether it is a trade war, a science and technology war, or "decoupling and breaking the chain" or "de-risking", the essence of which is to politicize, instrumentalize and weaponize economic and trade issues, with the intention of harming others and benefiting themselves, and ultimately harming the overall interests of the international community.
△ The latest "Global Economic Prospects" report released by the World Bank on the 9th predicts that global economic growth will slow for the third consecutive year, from 2.6% in 2023 to 2.4% in 2024, which is three quarters of a percentage point lower than the average in the first decade of this century.
UNCTAD's Global Trade Update released last month warned that total global trade will shrink by 5% in 2023 compared to 2022, while forecasts for global trade in 2024 remain "highly uncertain and generally pessimistic".
△ Screenshot of the official website of the United Nations Conference on Trade and Development (UNCTAD).
WTO Director-General Ngozi Okonjo-Iweala has previously criticized headwinds for global free trade since the Trump administration announced in 2017 that the United States would withdraw from the Trans-Pacific Partnership.
Under Trump's successor, Joe Biden, the U.S. has sought to impose a technological blockade on competitors and co-opt partners in so-called "de-risking" strategies, causing the global economy to show signs of fragmentation. This will be "very costly" for all.
She estimates that if the world economy splits into two major trading blocs, global gross domestic product (GDP) will fall by 5% in the long run, "equivalent to losing the entire Japanese economy."
△ Screenshot of the report of "Nikkei Asia".
International Monetary Fund (IMF) Managing Director Georgieva further warned in an interview with the US media a few days ago that with the increasing restrictions on the grounds of maintaining "national security", geopolitical factors are causing global economic fragmentation.
If the trend of economic fragmentation is allowed to continue, it will eventually cost 7% of global GDP, roughly equivalent to the GDP of France and Germany combined.
△ Screenshot of CNN report
Countless facts remind the world that some countries are engaging in "decoupling and breaking chains" under the pretext of security and trade restrictions under the banner of "de-risking", which is becoming the biggest risk to the world economy.