Shipping container with Chinese flag
October 31, 2020
Articles

Ahead of the 2020 U.S. presidential election, Prof. Yossi Sheffi comments on one of the most widely discussed issues in the campaign: trade relations between the U.S. and China. He writes:

The Trump administration’s aggressive stance toward China has compounded uncertainty on U.S.-China trade relations. In considering how the presidential elections may affect the flow of international trade, companies should avoid the accepted wisdom.

Business leaders should keep in mind that the trans-Pacific trade war hasn’t curtailed export shipments to the degree many feared. As The Wall Street Journal reported recently, China’s exports to the U.S. were down by only 3.6% in the first eight months of 2020, even while global trade was being thrown for a loop by coronavirus lockdowns.

Much of this business was driven by surging exports of items needed to combat the Covid-19 pandemic. This is despite the recent outcry that the U.S. relies too much on China for vital supplies such as personal protection equipment. In fact, global demand for PPE and other virus-related goods is helping China offset declines in exports of other goods.

Assumptions the Covid-19 pandemic and deteriorating U.S.-China trade relations would trigger an exodus of U.S. companies from China also have been off the mark.

Further insights and discussion on U.S-China trade relations can be found in Prof. Sheffi's latest book: The New (Ab)Normal: Reshaping Business and Supply Chain Strategy Beyond Covid-19.