Page 11 - 2020 Special Report on the State of Business in South China
P. 11
sibility of a collapse is not farfetched. In such a 虽然这部分业务不算是贸易逆差的一部分，但它反
scenario, world recession would not be far behind. 过来也为美国创造了数千个高薪岗位。即便仅以6%
American companies, as well as most companies on 的年增长率增长，中国每年GDP也会增加超过8500
the planet, depend on this supply chain for various 亿美元，比瑞士整个国家的GDP都高，略低于荷兰
reasons. Many goods assembled in China or the US GDP。我建议，我们需要与中国合作，在中国经济中
depend on raw material from and parts manufactured 占据更大的份额。随着《中美第一阶段经贸协议》的
in many different countries in the world. As it is stated 签署，达成第二阶段的交易协议是绝对必要的。
in our White Paper research, it will take 2-3 trillion US
dollars to replace the current supply chain. Therefore, 对中美贸易谈判，我们依旧怀抱希望，并坚信中
it is of paramount importance that the two major 美两国必将达成贸易协定，最终结束针锋相对的关
economies of this supply chain sit down to establish 税壁垒和言语攻击。但除非中美两国立即回到谈判
the stabilizer we suggested earlier in this message. 桌上，开始进行第二阶段谈判（中方也表示这在近期
很难实现），否则第一阶段将成为这一代人以来最大
It’s time to get to work. According to a 16-month 的政治失败和经济失败。为了国际市场和贸易的发
study by Professor Michael Enright of the University 展，第二阶段谈判必须取得进展。
of Hong Kong (former faculty at the Harvard Business
School) using foreign direct investment (FDI) numbers 虽然谈判进展可期，但无人能确定第二阶段协定
and its multipliers, on the average across China one 到底能否达成。贸易局势长期不明朗，企业和投资者
third of China’s GDP and 27 percent of its employment 很难满怀信心地制定计划。全世都在关注两国领导
are created by foreign invested enterprises (FIEs). 的举措，国际贸易无法接受美中协定再推迟一年。
This analysis also show in Shanghai 67 percent of
the industrial output and 90 percent of its high-tech
output are created by FIEs. Considering that China’s
2019 nominal GDP was reported at around US$14.2
trillion, this information translates into roughly 4.68
trillion US dollars of economy generated by FIEs of
which American companies are a substantial part. It
has taken billion of US dollars and much commitment
and resources to create this part of the economy.
While this amount of business is not calculated as a
part of the trade deficit, it creates thousands upon
thousands of high paying jobs back in the US. Keeping
in mind that even growing at a 6 percent annual rate,
China creates over 850 billion additional US dollars
to its economy – an amount larger than the GDP of
Switzerland and just under the entire GDP of the
Netherlands. I suggest that we need to work with
China to capture an even larger piece of this economy.
With Phase One signed, finalizing a Phase Two deal
becomes an absolute necessity.
We remain hopeful and determined that these
two nations will work out a deal that will eventually
see an end to the tit-for-tat tariffs and harsh rhetoric.
But unless the US and China immediately return to the
negotiating table to start Phase Two, a step that China
has also indicated is not imminent, Phase One will go
down as one of the biggest political and economic
failures in a generation. For the sake of international
markets and trade growth, the negotiations must
continue to make progress.
Progress can still come, but whether a Phase
Two will live up to the promises is anyone’s guess.
The persistent uncertainty over trade has made it
hard for companies and investors to make plans with
confidence. The world is watching for leadership from
both countries. International trade does not accept
that an agreement between the US and China can be
pushed down the road for another year.
11
scenario, world recession would not be far behind. 过来也为美国创造了数千个高薪岗位。即便仅以6%
American companies, as well as most companies on 的年增长率增长，中国每年GDP也会增加超过8500
the planet, depend on this supply chain for various 亿美元，比瑞士整个国家的GDP都高，略低于荷兰
reasons. Many goods assembled in China or the US GDP。我建议，我们需要与中国合作，在中国经济中
depend on raw material from and parts manufactured 占据更大的份额。随着《中美第一阶段经贸协议》的
in many different countries in the world. As it is stated 签署，达成第二阶段的交易协议是绝对必要的。
in our White Paper research, it will take 2-3 trillion US
dollars to replace the current supply chain. Therefore, 对中美贸易谈判，我们依旧怀抱希望，并坚信中
it is of paramount importance that the two major 美两国必将达成贸易协定，最终结束针锋相对的关
economies of this supply chain sit down to establish 税壁垒和言语攻击。但除非中美两国立即回到谈判
the stabilizer we suggested earlier in this message. 桌上，开始进行第二阶段谈判（中方也表示这在近期
很难实现），否则第一阶段将成为这一代人以来最大
It’s time to get to work. According to a 16-month 的政治失败和经济失败。为了国际市场和贸易的发
study by Professor Michael Enright of the University 展，第二阶段谈判必须取得进展。
of Hong Kong (former faculty at the Harvard Business
School) using foreign direct investment (FDI) numbers 虽然谈判进展可期，但无人能确定第二阶段协定
and its multipliers, on the average across China one 到底能否达成。贸易局势长期不明朗，企业和投资者
third of China’s GDP and 27 percent of its employment 很难满怀信心地制定计划。全世都在关注两国领导
are created by foreign invested enterprises (FIEs). 的举措，国际贸易无法接受美中协定再推迟一年。
This analysis also show in Shanghai 67 percent of
the industrial output and 90 percent of its high-tech
output are created by FIEs. Considering that China’s
2019 nominal GDP was reported at around US$14.2
trillion, this information translates into roughly 4.68
trillion US dollars of economy generated by FIEs of
which American companies are a substantial part. It
has taken billion of US dollars and much commitment
and resources to create this part of the economy.
While this amount of business is not calculated as a
part of the trade deficit, it creates thousands upon
thousands of high paying jobs back in the US. Keeping
in mind that even growing at a 6 percent annual rate,
China creates over 850 billion additional US dollars
to its economy – an amount larger than the GDP of
Switzerland and just under the entire GDP of the
Netherlands. I suggest that we need to work with
China to capture an even larger piece of this economy.
With Phase One signed, finalizing a Phase Two deal
becomes an absolute necessity.
We remain hopeful and determined that these
two nations will work out a deal that will eventually
see an end to the tit-for-tat tariffs and harsh rhetoric.
But unless the US and China immediately return to the
negotiating table to start Phase Two, a step that China
has also indicated is not imminent, Phase One will go
down as one of the biggest political and economic
failures in a generation. For the sake of international
markets and trade growth, the negotiations must
continue to make progress.
Progress can still come, but whether a Phase
Two will live up to the promises is anyone’s guess.
The persistent uncertainty over trade has made it
hard for companies and investors to make plans with
confidence. The world is watching for leadership from
both countries. International trade does not accept
that an agreement between the US and China can be
pushed down the road for another year.
11
