US trade flows are realigning in the wake of pandemic shocks and tensions with China, but efforts to reduce interdependence between the superpowers have not slowed down rapidly.
US trade flows are realigning in the wake of pandemic shocks and tensions with China, but efforts to reduce interdependence between the superpowers have not slowed down rapidly.
While security concerns have risen and US imports from China have fallen after Washington and Beijing imposed tit-for-tat tariffs, trade has since rebounded.
The number could rise further when trade data for 2022 is released next month, which shows how interconnected the world's two largest economies are.
But experts say the stress has left its mark in other ways.
"US imports from China are well below the trend before the trade war started," said Mary Lovely, senior fellow at the Peterson Institute for International Economics (PIIE).
"There has certainly been a shift away from China in US imports, particularly or mainly in those goods on which the US has raised tariffs," he told AFP.
After the trade war began, the value of US goods imported from China fell from $506 billion in 2017 to about $450 billion in 2019.
Bilateral relations are not the only factor affecting trade. The epidemic also caused great devastation.
Last November, China saw its sharpest drop in exports since the start of Covid-19, with business activity hammered by a strict zero-Covid policy.
Ryan Sweet of Oxford Economics said the weight on imports also reflects "an ongoing shift in the US from spending on goods".
Americans spent heavily on imported products during the pandemic, but "people are going back and spending on services" as virus concerns have eased, he said.
This cuts into demand for goods and may help explain why the numbers haven't risen higher.
diversification, not decoupling
For now, US government figures as of November suggest that total US-China trade could reach or hit a high in 2022.
"Going forward, you're going to see more diversification," Sweet said, as opposed to a complete cut-off of shipments from China.
For example, auto manufacturers experienced supply chain problems during the pandemic.
Robert Koopman, a lecturer at American University and former chief economist at the World Trade Organisation, said "increasing climate disruption" also increases the risks of supply chains being over-concentrated to one firm or one geographic region.
Meanwhile, the US is trying to become more self-sufficient in specific areas such as semiconductors.
"The recent (Inflation Reduction Act) and the CHIPS Act, and related sanctions, are clear indicators of the Biden administration's efforts to disengage from China in these areas," Koopman said.
Emily Benson, Senior Fellow at the Center for Strategic and International Studies (CSIS), said: "When companies re-evaluate risk and review the current state of their supply chains, a consistent result is the movement ... from China to other countries." in."
These could be countries in Southeast Asia or close to the United States.
"When this trend is rising, it looks more like sand leaking out of a bag than a tsunami," he told AFP.
Benson said it is likely "too early" for definitive comments on industries, but US export controls are "going to force some decoupling" over time in technology or areas where semiconductors are important.
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