XI’S GOTTA HAVE IT: China’s Flood of Cheap Goods Is Angering Its Allies, Too.
With President-elect Donald Trump saying he plans to significantly increase tariffs on China, Beijing is hoping to unload more of its excess factory production to developing-world countries, from Indonesia to Pakistan to Brazil.
But many of those countries are pushing back, as cut-price Chinese imports put pressure on their factories, killing jobs and blocking efforts to grow manufacturing at home. Many poorer countries have been counting on expanding manufacturing as the best way to propel their rise up the development ladder.
For China, the emerging backlash threatens to undermine its goal of being a leader of the developing world, whose support it has courted as a means of building its own alliances to counter the U.S.
Many developing countries now fear they will endure the same kind of “China Shock” that gutted U.S. industry starting a quarter-century ago. Economists estimate the U.S. lost more than two million jobs between 1999 and 2011 as makers of furniture, toys and clothes buckled under competition from Chinese imports.
China has a huge excess of industrial capacity, which isn’t the worst problem to have. But Xi can’t afford the political risk of economic restructuring, so those factories have to keep flooding foreign markets — even friendly ones.
“China is asshoe,” as they say.