FOREX VIEW: Focus On China Trade Evokes Image Of 1980s
Budget deficits are hitting record levels, the manufacturing industry is fast losing jobs to producers abroad and U.S. legislators are blaming a large Asian country.
This might sound like an anecdote from the Reagan years, but it's actually an assessment of the current state of the economy and helps underscore why elected officials are suddenly blaming Asia for the loss of competitiveness by U.S. manufacturers. The key difference from the 1980s is that this time, the villain is China, not Japan.
Many economists and manufacturers alike reckon the chorus of complaints over China's currency regime could grow into some sort of trade dispute, the likes of which were seen with Japan back then.
"I think the analogies are very, very similar," said Jay Bryson, global economist at Wachovia Securities, in Charlotte, N.C. "What happened back in the '80s was with all the political pressure and attention on Japan, there was a lot of protectionist sentiment in the U.S. at the time."
The upshot was Japan's agreement to impose "voluntary" export restraints on goods such as cars and video recorders and eventually - after a bitter fight - the short-lived 1995 U.S.-Japan auto pact that ultimately achieved little in terms of opening Japan's auto market to foreign competition. Meanwhile, Japanese companies have eaten steadily into the U.S. market share of Detroit's Big Three car makers, prompting sporadic talk that some form of new trade agreement is needed.
The frustrations with China now are leading to similar kinds of feelings, particularly as legislators point to the same kind of rise in protectionist sentiment in Congress.
"I think the exact same thing is going to happen with China, although I don't think it's going to be something in the near term," said Bryson. Neither does he believe the dispute over China's peg will necessarily result in the kind of trade agreements reached with Japan back then, not least because of the existence of the World Trade Organization.
Growth Stands In Stark Contrast
But Bryson and others say the growing tide of unrest over what many perceive to be China's unfair competitive edge could lead to acrimonious trade relations and ultimately prompt some sort of change in the peg.
To be sure, many observers reckon the U.S. will be reluctant to overtly pressure China at a time when it still needs its cooperation in helping deal with the crisis in North Korea. If that were settled however, "the administration may not feel as constrained to pressure the Chinese to revalue their currency," said Bryson. "In our view, revaluation is a question of when, not if."
The extent to which the issue of the China peg has emerged as a focus on the international economic and political scene in recent months is striking. High-ranking officials, including Federal Reserve Chairman Alan Greenspan to Treasury Secretary John Snow, have indicated China will have to alter its currency regime at some point. Legislators in Europe and the U.S. have become increasingly vocal, calling on Beijing to at least revalue, arguing that it cannot continue to use a weak exchange rate to gain global market share.
Indeed, the key reason Beijing is under the spotlight now is because global growth is weak. While many nations in the industrialized world have struggled to eek out 1-2% growth in recent quarters, the Chinese economy expanded 8.2% in the first half of the year, despite the outbreak of severe acute respiratory syndrome, or SARs. Foreign direct investment surged 34.3% in the same period to $30.3 billion while its trade surplus swelled to $4.5 billion, much of that coming at the expense of the U.S.
In a world of such generally meager economic performance, this kind of growth seems remarkably high. What's more, critics charge China owes a lot of this to the yuan's peg to the dollar, which means the domestic currency has weakened on the coattails of its U.S. rival, further reinforcing China's edge in global markets.
In another analogy with Japan in the 1980s, China is also expanding the depth and sophistication of its product reach and in the process hurting more U.S. manufacturers, partly explaining why many appear to be suddenly up in arms. Whereas some years ago, China initially began to take market share in sectors that U.S. companies were rapidly exiting, such as toys, leather goods, footwear or apparel - it has recently made greater inroads into areas U.S. manufacturers are trying to compete in, such as high-end plastics or tool and die industries.
This is prompting more and more complaints from U.S. companies. "I can produce a particular mold for one of my former customers for $25,000 - and that's a very competitive price," said Jay Bender, president of Falcon Plastics, in Brookings, S.D., at a recent Congressional committee hearing. "They purchased a similar Chinese mold for under $3,000...These numbers tell me that something here just doesn't add up - something is wrong."
Officials at the National Association of Manufacturers certainly think the China frustrations have the capacity to rival the 1980s showdown with Japan. "We're just on the cusp of this, no question," said Frank Vargo , vice president for international economic affairs at the NAM in Washington. "Japan, at the time, was concentrated in steel, automobiles and electronics - China clearly is looking to spread into everything."
He stressed the NAM isn't looking for a sudden death type solution, but more a plan from China that lays out the steps it could take towards reforming its foreign exchange system.
中美贸易龃龉重显昨日魅影
预算赤字创纪录水平，制造业工作岗位迅速向海外流失，美国议员将这一切归罪于一个亚洲国家。
听起来像是里根(Reagan)时代的事情，但这确实是美国经济现状的表述，这也有助于解释为什么政府官员突然指责亚洲是造成美国制造商失去竞争力的罪魁祸首。唯一不同的是，80年代受到指责的是日本，而今天是中国。
很多经济学家和制造商都认为，对中国汇率制度所发泄的种种不满有可能会发展成为某种贸易纠纷，这有点类似当年日本的情形。
Wachovia Securities全球经济学家杰伊．布赖森(Jay Bryson)说，"如今的情况与当年非常相似，80年代，所有的政治压力和关注焦点都集中在日本身上，当时的美国弥漫著浓厚的贸易保护主义情绪"。
其结果是，日本同意对汽车和录影机等产品的出口加以"自愿"限制，并经过一场恶斗之后于1995年签署日美汽车贸易协定，但这项旨在推动日本向外国竞争对手开发市场的协定最终未能取得成效。而与此同时日本汽车制造商却不断蚕食著底特律三大汽车巨头的美国市场份额，所以时而会听到要求重新签署贸易协议的呼声。
美国制造商吃了中国的亏，现在这也引发了类似的情绪，尤其是一些议员指出国会中也有贸易保护主义情绪抬头的迹象。
"我认为在中国身上也会发生同样的事情，虽然不一定是在短期内"，布赖森说。他还认为，由于世界贸易组织(World Trade Organization)的存在，中国汇率制度产生的争议未必会像日本当年那样，让双方达成某种形式的贸易协议。
中国经济鹤立鸡群
然而，布赖森等人指出，很多人认为中国的竞争优势是不公平的，这种不满情绪不断增长有可能会恶化贸易关系，并最终促使中国对钉住汇率制度做出一定的调整。
可以肯定的是，美国目前在朝鲜问题上正需要中国的合作，在这个时候它不愿意明目张胆地向中国施压。布赖森说，但如果朝鲜危机解决了，美国政府就会太顾忌向中国施压要求人民币升值。他说，"我们认为，重估人民币只是时间的问题，而非是否会的问题"。
中国汇率制度的问题在最近几月成为了世界经济和政治舞台上备受关注的焦点，其席卷范围之广令人吃惊。包括美国联邦储备委员会(Federal Reserve)主席格林斯潘(Alan Greenspan)和美国财政部长约翰．斯诺(John Snow)在内的美国政府高层官员都出面表示，中国必须在适当时候对汇率管制做出调整。欧美各国议员的呼声也越来越响，他们呼吁北京至少要重估人民币的汇率，称中国不能再继续利用疲软汇率来争夺世界市场。
其实，北京成为世界焦点的一个主要原因是全球经济增长疲软。最近几个季度，很多工业化国家只是勉强实现了1-2%的增长率，而中国经济尽管遭受了非典型肺炎(SARS)影响上半年依然增长了8.2%。中国的外国直接投资同期大幅增长34.3%，达到303亿美元；贸易顺差扩大至45亿美元，而多半是以美国的贸易逆差为代价的。
在世界经济表现普遍强差人意的情况下，中国经济的高速增长简直是鹤立鸡群。批评人士将中国经济的增长主要归结为是人民币钉住美元，也就是说，钉住美元的人民币随著美元的贬值而贬值，从而进一步增强了中国在国际市场上的竞争力。
另一个与80年代日本的情况很相似的地方是，中国的产品种类更加广泛，加工程度更加精密，并在这个过程中使很多美国制造商的利益受到损害，这在一定程度上可以解释为什么很多美国企业突然开始叫嚣反对。而几年前刚开始的时候，中国占领的市场大都是美国公司迅速撤出的行业，如玩具、皮具、鞋类或服饰。但现在中国已经日益深入到美国制造商也试图竞争的领域，如高端塑料制品或工具，还有模具行业等。 美国公司的怨言越来越多。Falcon Plastics总裁杰伊．本德尔(Jay Bender)在最近一个国会委员会的听证会上说，"我能以25,000美元为从前的客户定做模具，这已经是个非常优惠的价格了，但他们在中国却能以3000美元以下的价格就买到一个类似的模具......这些数字说明有些事情并不合理，出了差错。"
美国全国制造商协会(National Association of Manufacturers)有关人士坚定认为，美国公司在中国身上吃的亏将毫不逊色于80年代日本给美国的教训。美国全国制造商协会国际经济事务副总裁弗兰克．瓦戈(Frank Vargo)说。"毫无疑问，这还只是个开头，日本当时著重发展的是钢铁、汽车和电子产品，但中国对每个领域都在虎视眈眈。"
他强调说，全国制造商协会并不想突然死亡的疗法，更多的是希望中国能有计划地采取措施，逐步改革其外汇制度。
