US-China Trade Imbalance Social Sciences Essay Paper (Essay Sample)

US-China Trade Imbalance
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US-China Trade Imbalance
The United States under Trump’s administration, have been fast forward in efforts to address the significant trade imbalance with China. The major categories of imports from China include toys, clothing, sporting goods, phones, and computers. The trade deficit with China has been on the rise over recent years. In 2012, the deficit was estimated at $ 315.1 billion, and by 2015, the deficit had increased to $ 367.3 billion. In 2016, the US realized an increase in exports leading to a slight drop in deficit to $ 346.8 before a significant increase by 2018 to $ 419.5 billion (Kimberly, 2020). The US saw a reduction in the deficit in 2019 to $345 billion. The considerable deficit has seen the Trump administration increase its commitment to bringing trade balance between the two economies.
China is considered one the biggest exporter of manufactured goods globally and the world's factory. Numerous US multinationals have their supply chain in China, with longstanding supplier relationships and established procurement processes. The current deficit against China is significantly contributed by US multinationals that prefer manufacturing their products in China before shipping the products to the US (Kimberly, 2020). The value of the dollar has been very high, making manufacturing in the US expensive compared to China. The low labor costs in China have particularly been a significant factor for multinationals moving their production in China.