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Siri: 'Can the iPhone Prove President Trump's Wrong about U.S.-China Trade?'

Yukon Huang, Carnegie Endowment

1. For decades, about 50% of U.S. imports of manufactured goods have come from Asia.
2. During this time China has risen from supplying 10% of those Asian goods to supplying 65%.
3. The reason: after joining WTO, China became Asia's assembly plant.
4. Companies ship components manufactured in other Asian countries to China for assembly and export as finished products.
5. And, the full price of those products - components as well as profits - go on China's trade balance, even though China's only economic benefit is the assembly.
6. Hence, China's actual trade surplus is smaller than stated, and, in fact, is a stand-in for Asia's overall trade surplus with the U.S.