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Nov 19,2021

The impact of the first video meeting between China and the US on air cargo services

On November 16, 2021, the first video meeting between China and the United States released many positive signals. The Biden administration also proposed to use this meeting to lay the foundation for a series of substantive Sino-US dialogues and cooperation in the next step. The bilateral relations showed positive trends. Bilateral economic and trade issues represented by tariffs have also been put on the agenda along with the easing of Sino-US relations.


Trade intervention and Air freight services


International air cargo has grown up with the vigorous development of international trade. Since the 2008 international financial crisis, the world economic development has continued to be sluggish, trade and investment disputes between countries have intensified, the global industrial structure and financial stability have been severely impacted, and the downside risk of world economic operations has increased.


In this context, isolationism has recovered, trade protectionism has reappeared, and the number of global trade controls has continued to rise. As a result, international trade has continued to stall, and the growth of air cargo, which relies on the free flow of trade, is insufficient. Since 2020, as trade control measures against the epidemic, such as export restrictions, have increased significantly, the development of global air cargo has also been impacted.


Air freight services


In recent years, high-tech products, equipment accessories and personal clothing items have been the main products exported by air from my country to the United States. However, exports of high-tech products are extremely vulnerable to external policies such as trade disputes, and air exports to the United States have shown a downward trend.


During the epidemic, the United States has seen a substantial increase in air import demand for my country's equipment parts and components, which reflects that North America is still unable to get rid of its dependence on my country's manufacturing capacity for the time being. Under the influence of the epidemic, developed countries in Europe and the United States are unlikely to spend too much capital under the economic downturn. Manufacturing is not the main driving force for US economic growth. With current technology weakening the driving force for US economic growth, the United States’ top priority It is still the development of high-tech industries, and it is less likely to switch to investment in traditional manufacturing. Therefore, the supply of traditional manufacturing products in the United States will still depend on my country. This has led to the mid-to-long-term vision of the return of US manufacturing and the current US industrial supplies. The economic characteristics of the surge in demand appear contradictory.


Therefore, the Biden government may implement tariff exemption procedures to exempt my country’s machinery, equipment, electronic equipment, and other products that are under high pressure in the supply chain. At the same time, my country is also likely to abolish the tariff countermeasures on US raw materials and transportation equipment such as aircraft. , To jointly alleviate and break through the bottleneck of the international supply chain.