China No Longer leading source of goods imported to US: THIS Country Overtakes Beijing

china no longer leading source of goods imported to us: this country overtakes beijing

For the first time in over two decades, Mexico surpassed China as the primary supplier of commodities imported into the United States last year. The change underscores rising tensions between Washington and Beijing, as well as the United States’ efforts to purchase from more friendly and closer-to-home countries.

According to figures issued Wednesday by the US Commerce Department, the value of products imported to the US from Mexico increased by about 5% between 2022 and 2023, reaching more than $475 billion. At the same time, the value of Chinese imports fell by 20% to $427 billion.

The last time Mexican commodities brought into the United States eclipsed the value of Chinese imports was in 2002.

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Economic ties between the United States and China have deteriorated significantly recently, with Beijing fighting vigorously on trade and making alarming military gestures in the Far East.

The Trump administration began tariffs on Chinese goods in 2018, claiming that Beijing’s trade policies breached international trade laws. President Joe Biden maintained such tariffs after assuming office in 2021, indicating that enmity towards China would be a rare area of agreement between Democrats and Republicans.

Instead of offshoring production to China, as U.S. firms had long done, the Biden administration has encouraged companies to seek suppliers in friendly nations (“friend-shoring”) or to restore manufacturing to the United States (“reshoring”). Supply-chain disruptions caused by the COVID-19 outbreak prompted U.S. corporations to seek suppliers closer to home (“near-shoring”).

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Mexico has benefited from the rising move away from Chinese industries. But the picture is more convoluted than it appears. Some Chinese firms have opened facilities in Mexico to take advantage of the three-year-old United States-Mexico-Canada commerce Agreement, which provides for duty-free commerce in North America for numerous items.

Derek Scissors, a China specialist at the conservative American Enterprise Institute, noted that the most significant drops in Chinese imports were in computers and electronics and chemicals and pharmaceuticals — all politically sensitive categories.

“I don’t see the U.S. being comfortable with a rebound in those areas in 2024 and 2025,” Scissors said, predicting that the China-Mexico reversal on imports to the United States likely “is not a one-year blip.”

Scissors suggested that the drop in U.S. reliance on Chinese goods partly reflects the wariness of Beijing’s economic policies under President Xi Jinping. Xi’s draconian COVID-19 lockdowns brought significant swaths of the Chinese economy to a standstill in 2022, and his officials have raided foreign companies in apparent counterespionage investigations.

Written by: Arkaprovo Roy.