Blitz Bureau
NEW DELHI: China, the world’s second biggest economy, is exporting more products than ever. It is just redirecting them away from the US tariff wall and toward more open markets in Europe and elsewhere in Asia.
The shift in Chinese trade risks creating a European sequel to the China Shock that wiped out hundreds of thousands of factory jobs in the American heartland in the 2000s and contributed to the political upheaval that put Donald Trump in the White House twice.
Despite US sanctions, China last year notched a record global trade surplus — an astonishing $1.2 trillion.
Earlier this year, French President Emmanuel Macron warned that Chinese exports are “literally killing a large part of the European industry’’ and admitted that Europe was “slow to see that.’’
China’s trade practices were near the top of the agenda this week as leaders of the G7 rich democracies gathered in Évian-les-Bains, France. In briefings last week, French officials indicated that they hoped to come out with a plan to tackle the China threat.
The G7 leaders didn’t mention China by name in a statement from the summit on “balanced, durable and resilient growth.’’ But they clearly had Beijing in mind when they noted “with concern that global imbalances have been persistent and widened in recent years.’’
Germany has been hit hard. German companies once grew fat on exports to China but the situation has reversed: China now sells more goods to Germany than it buys. And German companies are struggling to compete with the Chinese rivals in industrial machinery, construction equipment, cars and chemicals – all mainstays of Germany’s export-oriented economy.
Despite Trump’s tariffs and diminished sales to the United States, China is benefiting from soaring demand for its low-cost EVs and from AI investment.
