May 2021 Trade Bulletin

Highlights of This Month’s Edition

• Bilateral Goods Trade: U.S. goods exports to and imports from China both rose drastically in Q1 2021, reflecting ongoing recovery that is bringing the countries’ economies closer together; U.S. agricultural exports continued to lead trade with China but at levels far below the preceding quarter; at $34.5 billion, U.S. imports of computer and electronics products from China nearly equaled the total value of U.S. exports to China. 
• Bilateral Services Trade: For full-year 2020, U.S. services exports to China were down 32.9 percent year-on-year due to the COVID-19 pandemic; services related to tourism and culture primarily account for the precipitous decline between 2019 and 2020, with travel services exports alone plummeting by 48.6 percent.
• IP: USTR’s 2021 Special 301 Report highlights persistent challenges faced by U.S. IP rights holders in China as Beijing takes new steps to secure access to foreign technology and IP. 
• Boao Forum: At the Boao Forum, Chinese government officials sought to portray the country as a leader of economic globalization and global cooperation while also promising to control volatility in the domestic stock market caused by inflows of foreign capital.
• Quarterly Review of China’s Economy: China’s economy grew 18.3 percent year-on-year in Q1 2021, according to official statistics; this recovery was highly lopsided, with strong industrial output overshadowing faltering consumption; stimulus measures drove debt buildup within local governments and property sector, prompting renewed de-risking efforts by policymakers. 
• Huarong: Investors’ assumptions about implicit guarantees in China’s corporate debt market are challenged as state-owned asset manager Huarong struggles to repay bonds.    
• Chinese Big Tech: Big tech companies continue to face increased scrutiny from Beijing as regulators imposed a record fine of $2.8 billion against Alibaba and opened investigations into other big tech firms.