Arthur Kroeber

The disruption caused by trade tensions is not going to give the US more market share for American companies, says leading economist Arthur Kroeber, author of China’s Economy: What Everyone Needs to Know® to Bloomberg. And that is not what the US wants: “The USTR is not trying to bargain with Beijing: it is trying to force a deep change in behavior.”


The U.S. Trade Representative’s office, along with national security officials labeling China a “strategic competitor” ultimately aren’t interested in things such as greater market access for American companies, says Arthur Kroeber, head of research at economic consultancy Gavekal Dragonomics in Beijing. Instead, these Trump administration elements are engaging in an effort to contain the growing sway of a state-driven Chinese economic model on the global stage, he argues.

“The USTR is not trying to bargain with Beijing: it is trying to force a deep change in behavior,” Kroeber wrote in a March 2 note. The policy “is to either get China to dismantle its industrial-policy edifice and conduct its economy more along Western lines, or failing that, ensure the U.S. defeats China in the race for technological supremacy.”

Kroeber added that “the odds are that the trade and security hawks will have the better of the battle in 2018” in the administration, unless supporters of globalization such as White House economic adviser Gary Cohn can organize greater support from U.S. companies with major China operations that could be under threat.

More in Bloomberg.

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