March 2021 Trade Bulletin

Highlights of This Month’s Edition

• U.S.-China Trade: In January 2021, U.S. goods exports to China increased 78.2 percent year-on-year to $12.9 billion, marking the largest year-on-year increase since November 1991; U.S. imports of Chinese goods grew 17.5 percent year-on-year to $39.1 billion; China continues to lag behind purchase commitments under the Phase One trade deal.
• Biden Administration Undertakes Supply Chain Review: Biden Administration aims to reduce dependence on China as it begins comprehensive study of U.S. supply chain vulnerabilities in strategic products and sectors.
  China’s Role in African Debt Bailouts: Recent debt renegotiations by Chad, Ethiopia, and Zimbabwe under a new G20 program have highlighted concerns over China’s opaque lending practices in the region and prompted fears of rising defaults across Africa amid COVID-related economic strain.
• Chinese Bond Market: Despite $15 billion in defaults in 2020, China’s bond market continues to attract foreign investors in search of high yields, with over $2.6 billion going to new purchases of Chinese government bonds in February 2021.
• Jiangxi Province Removes Residency Restrictions: This step to reform the restrictive hukou—or household registration—system in Jiangxi would allow rural migrants in major cities to access social services; draft 14th Five-Year Plan hints at broader hukou reform.
• In Focus – Food Security: The Chinese government released a new plan for rural revitalization in February 2021, reflecting its growing concerns about food security and inequality. The new policy suggests a move toward the commercialization of genetically modified crops and import diversification to buffer China against foreign supply shocks.