Normalizing Economic Relations with China
Nicholas R. Lardy
American companies have substantial interest in our economic relations with China. U.S. firms sold $17.5 billion worth of goods to China last year, either directly or through Hong Kong, making it our eighth largest export market. U.S. exports to China have been growing at an average annual compound rate of 20 percent since 1990, tripling in value over the period. That makes China the most rapidly growing export market among our top twenty export destinations.
In addition, U.S. firms have invested significant amounts in joint ventures, wholly foreign owned companies, and natural resource development projects in China. Through the end of 1996, cumulative U.S. investment in China was $13.5 billion, making the United States the third largest source of direct investment in China, following Hong Kong and Taiwan.