April 7, 2006
The World Trade Organization, in an evaluation of China's trade policy, reports that Taiwan amassed a trade surplus of
USD 58 billion with China in 2005, the largest of any of China's other trading partners.
Though Taiwan was China's third largest source of imports in 2005, accounting for 11.3% of imports to China behind Japan's 15.2% and South Korea's 11.6%, it still managed to rack up a larger trade surplus than its two East Asian neighbors. South Korea's trade surplus with China was second largest, at
USD 42 billion, while Japan's was third, at
USD 16.5 billion.
These are interesting figures unto themselves, however, the WTO's analysis provides deeper insight. The international trade body points out that the large trade surpluses with China of these three countries are partially the results of export shipments of parts and components to their manufacturing bases in China for manufacturing and assembly. The finished products are then exported from China back to the home country or on to other export destinations, Europe and the United States in particular. The WTO says that the result of these types of exports from China is that, by transferring final assembly and production to China, these three nations have in effect shifted parts of their previous trade surpluses with Europe and the US to China.
The US, Europe and Hongkong (which includes transshipment trade) are the top three export markets in order for China. The US has accumulated the largest trade deficit with China at
USD 114 billion. Hongkong and Europe have the next largest trade deficits at
USD 112 billion and
USD 70 billion respectively.
(United Daily News)
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