US-China Trade Relations
Once the largest trade partners, the US and China have shifted their trading activities. Washington now trades more with Canada and Mexico, while Beijing has increased trade with Southeast Asia. Raimondo, during her recent visit to China, indicated a strong desire among US businesses to make the relationship work despite some positive actions from the Chinese government. However, she stressed the need for a predictable environment and a level playing field.
Challenges Faced by US Firms in China
American firms in China are facing new challenges, including unexplained large fines, business raids, and changes to counterespionage laws. Raimondo also mentioned her email hacking incident before her August trip to China, which she raised with Chinese officials, emphasizing the difficulty in building trust with such actions.
China's Economic Slowdown
China is currently dealing with an economic slowdown that has impacted global markets, with a focus on the debt crisis of developer Country Garden. This crisis is significant as the real estate sector contributes to about a quarter of China's economy. Raimondo noted that China's economy performed better when it was transparent and market-oriented, and its current challenges are due to increased arbitrariness in administering regulations.
In conclusion, the U.S. Commerce Secretary has warned China that the patience of American businesses is wearing thin due to the unpredictable and challenging business environment. This comes at a time when China is facing economic challenges, and there is a global spotlight on its real estate sector's debt crisis.
