The Big Two-- China and Germany
The U.S. trade deficit with China in 2011: $295 billion.
Not only is the U.S. lagging far behind the two countries when it comes to achieving balanced trade, but the gap seems to be widening.
Now comes news that these two export powerhouses may be consolidating their position. As Didi Kirsten Tatlow reports in the International Herald Tribune, China and Germany may be building a "special relationship":
As global power shifts eastward, Germany and China are building a “special relationship” that risks undermining Europe’s overall position with the rising Asian giant and may have serious consequences for the balance of power between Europe and China, according to a hard-hitting new report from a European Union think tank.
On a deeper level, business, along with frustration at the European Union’s lack of coordinated policies, is driving the relationship, Mr. Kundnani and Jonas Parello-Plesner, analysts at the European Council on Foreign Relations, say in their report, “China and Germany: Why the Emerging Special Relationship Matters for Europe.”
“At present, there is an almost perfect symbiosis between the Chinese and German economies: China needs technology and Germany needs markets,” they wrote.
Tatlow says the two countries have "fast-deepening ties," though they already share a similar, export-focused drive.
Both countries enjoy the benefits of an undervalued currency. But Germany also employs specialized, niche manufacturing while favoring a flexible workforce that adjusts to changing market conditions.
China goes much further, though, boosting its industrial sector via preferential loans, energy rebates, and massive state subsidies.
It bears watching, then, this growing alliance between two key export-driven economies.
Related recent Blogs
- Nanette Lepore's New Shoe • by scapozzola • 05/24/2013
- May 24, 2013 Headlines: U.S.-EU trade deal exemptions, investing in U.S. manufacturing, and more. • by LRaup • 05/24/2013
- Washington State Bridge Collapse Illustrates Perils of Failing Infrastructure. • by scapozzola • 05/24/2013
- Reps. Daniel Lipinski (D-IL) and Michael Grimm (R-NY) form new Congressional Public Transportation Caucus. • by scapozzola • 05/23/2013
- Homeland Security and Gov. Tom Ridge • by scapozzola • 05/23/2013
- CNBC: Is a Chinese construction firm benefiting from its Beijing connection? • by scapozzola • 05/23/2013
- May 23, 2013 Headlines: Gains in the job market, small businesses manufacturing in the U.S.A., and more. • by LRaup • 05/23/2013
- VIDEO: Concerns about America's defense industrial base • by scapozzola • 05/22/2013
- CNBC: China investing in U.S. • by scapozzola • 05/22/2013
- In Indiana, ongoing concerns about subsidized auto parts from China and Japan • by scapozzola • 05/22/2013