Report Writing - A Global Power Shift in the Making

Report Writing - A Global Power Shift in the Making


China is considered to be the most populous country in the world with an enormously growing economy. Over the years it has gained considerable power in trading. However, this has proved to be quite beneficial instead of posing as a threat.


Although the growing power of China in the world economy is beyond measures, yet the benefits that the U.S derives from China surpass all factors like labor laws, human rights violations and many more. Over the past half a century the United States tried to establish a global economic system that was characterized by rules-based and liberalism (Noland, 1996). China has a stake in this global economic system that benefits the type of U.S-china relationship desired by the United States. Another striking advantage enjoyed by the United States is the currency issue faced by China. Institute of International Economics has shown that even a considerable appreciation in Yuan would make little to no difference to the United States. Chinese manufacturing includes low-cost imports (Gilboy, 2004). These low-cost imports have helped the U.S to save millions of dollars. This, in turn, has increased investments. Moreover,
companies like Intel, Ford, Boeing and many more have utilized this advantage of buying parts at low cost. This has increased their business activities and competitiveness in the United States thus adding to American wallets. This has also helped to reduce inflation in the United States. Another aspect, that thoroughly benefits the United States, is its import trends. China is a growing home to domestically imported goods (Wang, 2010). Although, in recent years, the U.S. export market has faced considerable recession, yet China has tripled its consumption of U.S goods. Chinese consumers are moved and motivated by foreign brands, cars, mobile phones, and many more such goods. This is has proved extremely profitable for the United States. Unlike Japan and Korea undertaking protectionism, China’s openness towards Foreign Direct Investment is another factor why the United States should maintain trade relations with China. The country thoroughly welcomes foreign investments to discover and construct new markets in the form of high-value-added products. Finally, the argument may arise that such openness of market and growing import may prove to be a considerable threat of a growing ally to the United States. However, the possibility of this happening is overruled by three factors. Firstly, the exports made by China which are characterized by high technology are mostly controlled by foreign firms and not domestic firms. Secondly, the industrial firms in China put more emphasis and depend on details, stricture, crucial components and other advanced industrial parts. China imports all of these components from the United States and other advanced countries. Thirdly, the country is not likely to come up as a global industrial competitor. This is due to its ineffectiveness of Chinese firms to take major steps in utilizing import technologies and diffusing them in the domestic market. 


Thus it can be clearly stated that although there are violations in the trade laws and labor activities in China, yet it proves to be a favorable market for the United States. Moreover, it can be stated that China is an important market contributing towards the growth of the U.S.

Reference List

Gilboy, G. J. (2004). The myth behind China's miracle. Foreign affairs, 33-48.
Noland, M. (1996). US-China Economic Relations (No. 96). Washington DC: Institute for International Economics.
Wang, D. (2010). China's trade relations with the United States in perspective. Journal of Current
Chinese Affairs, 39(3), 165-210.