Trump, Xi et les autres
Nous donnons ci-après l'analyse que Michael Pettis @michaelxpettis fait d'un article paru dans Caixin (Wang liwei et Qing Na, In Depth: How China Can Counter Trump’s Tariffs, 18 avril 2025).
This Caixin article summarizes various proposals by Chinese academics on how to respond to Trump's tariffs. Most of these proposals focus on boosting domestic demand, but some involve expanding "free-trade" relationships with other countries, which basically means that if the US stops absorbing China's growing trade surplus, China should ensure that other countries (mainly Europe) do so instead.But this misses the point. Dozens of countries have already raised tariffs on Chinese goods, and this is likely to worsen.Of course if other countries refuse to replace the US as the consumer of last resort of China's manufacturing expansion, the resulting contraction in China's trade surplus requires either that domestic production decline or that domestic demand rise.Because the former means a contraction in GDP and a rise in unemployment, the latter is obviously the preferred and only sustainable solution, and nearly every Chinese economist recognizes this. China simply cannot continue running such a low consumption share of GDP. How to raise domestic demand? There is one proposal to expand investment in infrastructure, but most Chinese economists recognize that infrastructure investment has already passed reasonable limits, and so other proposals are aimed mainly at consumption.
Most of these proposals correctly focus on current transfers, and these are really the only kind of proposals that are likely to boost consumption in the near term, although they do so at the cost of rising government debt. One economist argues, for example, that "the government should consider issuing another 1 trillion yuan in ultra-long special treasury bonds to pay for unemployment benefits, food vouchers for low-income individuals, and providing living allowances to college and university graduates." Is 1 trillion enough? The hope is that a big enough spending boost becomes self-reinforcing if it encourages local manufacturers to expand production, hire workers and raise wages. But for that to happen, consumption must rise by more than the decline in foreign demand.
