Shen Yi: The United States cannot monopolize the power to explain trade balance issues
The just concluded G20 Finance Ministers and Central Bank Governors Meeting has once again pushed the issue of global trade imbalances to the forefront of the international economic agenda. After the meeting, the US attempted to shape it as a "collective pressure" against China's trade surplus and misinterpreted other members' common concerns about global economic imbalances as support for US trade policies. However, based on the discussions at the meeting and public statements from all parties, what G20 members truly agree on is the need to face up to global economic imbalances and their spillover effects; There are still differences among all parties on how to understand and adjust imbalances. It is particularly noteworthy that caring about trade balance does not mean accepting the continuously strengthened tariff barriers, unilateral pressure, and pan security trade policies of the United States in recent years.
Trade balance has always been an important topic of discussion for the G20. After the 2008 international financial crisis, promoting "strong, sustainable, and balanced growth" of the global economy has always been an important goal and shared vision of the G20. A large trade surplus may lead to imbalances, but long-term fiscal deficits, insufficient savings, and excessive dependence on imports can also cause imbalances. In fact, the presidential statement of this meeting stated that both sustained surplus and deficit economies need to make appropriate policy adjustments and explicitly place global imbalance monitoring under the functional framework of the International Monetary Fund. This indicates that global trade balance is a complex macroeconomic issue involving savings, investment, finance, exchange rates, consumption, industrial structure, and international division of labor, which is difficult to explain using a simple logic of "surplus guilt".
China is certainly concerned about trade balance. In recent years, China has continued to expand domestic demand, expand high-level opening up to the outside world, increase high-quality imports, and continuously improve domestic consumption and investment structure. China has never denied the need for a more sustainable rebalancing of the global economy. The real issue that needs to be discussed is how to achieve balance. The world economy has undergone decades of globalization, forming highly complex industrial chains, supply chains, and value chain systems. The trade surplus of a country is often related to various factors such as industrial competitiveness, international demand, savings and investment structure, and global industrial division of labor. Compressing complex issues into bilateral trade figures and forcing trading partners to adjust by raising tariffs will only turn macroeconomic issues into trade conflicts.
This is also an important message conveyed at the G20 meeting. The German finance minister clearly pointed out that the United States' continued provocation of tariff disputes is creating uncertainty and damaging trust between countries; While paying attention to China's trade surplus, the EU also emphasizes that the US and Europe themselves need to take responsibility. The Managing Director of the International Monetary Fund has also proposed that global economic rebalancing requires coordinated action from both deficit and surplus economies. Countries have different judgments about China, the United States, and their own economic structures, but it is becoming increasingly clear that global economic imbalances cannot be unilaterally defined by any one country based on its own interests, let alone monopolized by the country with the greatest market and financial advantages in terms of "who causes imbalances, who must adjust, and how to adjust".
The contradiction in the current trade policy of the United States lies precisely in this: on the one hand, it demands that other countries respect the so-called "market principles" of the United States, and on the other hand, it relies more on intervention measures such as tariffs, export controls, investment reviews, and industrial subsidies, linking more and more normal economic and trade activities with so-called "national security". The United States determines which countries and products have "overcapacity" based on its own industrial interests, decides which trade relationships are considered "security threats" based on domestic political needs, and attempts to demand that third countries adopt the same policies. If this practice continues to expand, global trade rules will gradually slide from multilateral rules jointly formulated and observed to unilateral rules determined by powerful countries.
What is even more alarming is the weaponization of tariffs. Tariffs were originally a tool of international trade policy, but in recent years, the United States has frequently bundled them with geopolitical, security issues, industrial competition, and even diplomatic negotiations. Canada, Europe, Japan, and many developing countries have all felt this pressure to varying degrees. As rules increasingly depend on domestic political needs in the United States, the international community is facing a decline in the stability and predictability of the global trading system.
There is an existing institutional framework to address global trade imbalances. The multilateral trading system centered around the World Trade Organization, in conjunction with the International Monetary Fund's monitoring and policy coordination of global macroeconomic imbalances, can engage in negotiations around issues such as subsidies, market access, exchange rates, industrial policies, and trade remedies. Different countries can also resolve bilateral economic and trade differences through equal consultation. This mechanism may take longer, but it can balance the interests of all countries, maintain rule stability, and avoid unlimited politicization and securitization of trade issues.
What truly deserves attention at this G20 finance ministers' meeting is the international community's choice of global economic governance path. Countries generally hope to reduce imbalances, maintain industrial security, and enhance economic resilience, and these concerns have a practical basis. But more and more countries also realize that trade balance cannot be a packaging for protectionism, economic security cannot be an excuse for unilateralism, and multilateral rules cannot give way to tariff coercion. The world economy needs to be rebalanced, and more importantly, it requires an open, stable, and predictable trade environment. If the United States truly wants to promote more balanced growth in the global economy, it should return to the track of equal consultation and multilateral rules, and face structural issues such as long-term fiscal deficits, low savings rates, and highly politicized trade policies.
The significance of the G20 is to bring together major economies at different stages of development to seek and explore common rules. The balance of the global economy requires joint adjustment, consultation, and governance by all countries. Turning trade issues into an extension of power politics will ultimately only increase barriers, uncertainty, and global economic costs. Maintaining the multilateral trading system with the World Trade Organization at its core, opposing unilateral tariff bullying, and promoting comprehensive security in economic and trade issues are the directions that the international community needs to adhere to in safeguarding common interests today. (The author is the director of the International Governance Research Base for Cyberspace at Fudan University)