Why the U.S.

-China trade deficit is so huge:

Here’s all the stuff America imports
By Jeffry Bartash
Published: May 13, 2019 10:46 a.m. ET

The highs (few) and lows (many) of U.S. trading with China
The escalating trade war between the U.S. and China has led
both sides to raise tariffs, but the lopsided trade relationship
between the two countries means the impact will fall heaviest on
Chinese producers and American consumers and farmers.

The U.S. imported a record $539.5 billion in goods from China in

2018. The U.S. is a net importer from China in most market
segments such as consumer electronics, apparel, furniture and
industrial supplies. The one major exception: agriculture.

By contrast, the U.S. shipped a much smaller $120.3 billion in

goods to China last year, Census trade figures showed.

Exports to China fell from almost $130 billion in 2017 as buyers

shunned American soy and corn. U.S. farm exports to China fell
to $5.9 billion in 2018 from $15.9 billion in the prior year.

President Trump has raised or in the process of hiking tariffs on

virtually all goods imported from China because talks to resolve disputes over fairer trading rules have faltered. The
president accused China of reneging on prior commitments.
 Donald J. Trump
@realDonaldTrump

I say openly to President Xi & all of my many friends in China

that China will be hurt very badly if you don’t make a deal
because companies will be forced to leave China for other
countries. Too expensive to buy in China. You had a great deal,
almost completed, & you backed out!
60.1K 6:49 AM - May 13, 2019

24.3K people are talking about this

The flareup rattled Wall Street. The Dow Jones Industrial Average DJIA, -2.58% and S&P 500 SPX, -2.56% have tanked
in the past week as tensions spiked. The Dow fell another 500 points in Monday trades after China announced retaliatory
tariffs.

Read: The monster clash between U.S., China over trade dwarfs all other issues about the economy

U.S. tariffs on $200 billion in Chinese imports were increased on Friday to 25% from 10%.

Trump also said the U.S. would begin the process of applying the 25% tariff to another $325 billion in imports that have
been left alone so far. It could take several months or longer to put them into effect, though, giving the two countries more
time to negotiate.

Households and companies could pay more for a variety of consumer staples or business supplies. The U.S. imports
thousands of products from China ranging from TVs and cell phones to clothing and handbags to industrial chemicals and
rare metals.

The U.S. has run large deficits with China for years and in some cases no longer produces certain goods such as
consumer electronics that are popular with Americans. It won’t be easy, and it might even be impossible, to reduce the gap
much any time soon.

The U.S. is expected to maintain a large surplus with China in services, which totaled $40.5 billion in 2018. The surplus
largely reflects spending by Chinese tourists and exchange students.
So far the trade dispute has hurt China more than the U.S., but the economies of both countries have improved recently
and that may have spurred each side to take a tougher stance.

Economists, business leaders and investors worry that a long-lasting standoff between the two largest economies in the
world could result in lasting damage to the global economy if it metastasizes.

Related: With Trump threatening to tighten the trade screws, here’s a look at what tariffs have done so far

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Jeffry Bartash
Jeffry Bartash is a reporter for MarketWatch in Washington.

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