Thread by @ChinaFinance40

China’s exports to the US has declined sharply since this year, due to ongoing #tradewar, while those to Japan, the EU, Vietnam and the Philippines have witnessed gradual increase, said CF40 member Gao Shanwen, cf40.org.cn/uploads/newsle… 1/6

Generally, the share of Chinese exports in global trade has remained stable. The reasons include re-export trade. Products like boiler and motor that China usually exported to the US, have witnessed significant increase in export this year to the EU and Vietnam. 2/6

Another factor is exchange rate. In June and July last year when trade tension underwent rapid escalation, RMB depreciated against a basket of currencies by as much as 5%. RMB exchange rate on average depreciated by 3% compared with six months prior to the trade war. 3/6

The depreciation of RMB exchange rate caused by trade war has largely spread the impact of trade war on Chinese exports to other economies around the world, making China's share of global trade stable. 4/6

As shown in the Figure, among the unaffected goods, the proportion of US imports from China to total US imports has risen since mid-2018, indicating that exchange rate depreciation has significantly contributed to Chinese exports. 5/6

Of course, this also reflects the market's ability to make self-adjustment. It also shows to a certain extent that in the context of economic globalization, the effectiveness of bilateral-based tariff and trade agreements often tends to be limited. 6/6