BIG IDEA | ‘This week the media seized on a report by Eurostat, the European Union’s statistical agency, to declare that China surpassed the United States in 2020 to become the EU’s main trade partner. This is simply not true.’    

‘Eurostat’s report only addressed trade in goods.’

‘When you count services, not just goods, trade flows with the US are far larger.’

BIG IDEA | ‘U.S. and European commercial ties with China are akin to a two-lane highway. The commercial highway connecting the EU with the U.S., in contrast, looks more like a twelve-lane Autobahn. A host of economic ties bind the EU and the U.S. in far deeper ways than those that bind either to China.’  

‘This week the media seized on a report by Eurostat, the European Union’s statistical agency, to declare that China surpassed the United States in 2020 to become the EU’s main trade partner. This is simply not true.’    

• ‘Eurostat’s report only addressed trade in goods.’
• ‘When you count services, not just goods, trade flows with the US are far larger.’

‘Reducing complex commercial ties to one metric — trade in goods — ignores the importance not only of services, but a host of additional economic ties that bind the EU and the U.S. in far deeper ways than those that bind either to China.’  

‘U.S. and European commercial ties with China are akin to a two-lane highway, whereas their commercial ties with each other are more like a twelve-lane Autobahn.’  

• ‘The highways to and from China are full of goods. They are busy, and they are crowded.’
• ‘Any type of accident on a two-lane highway can really snarl traffic — as we saw when supply chains were disrupted by the pandemic and by the U.S.-China tariff war.’  

‘Alongside the highway are narrow bike lanes for services.’

• ‘The EU and China have been busy trying to build a new lane on their highway — an investment path that they believe could unsnarl some of that traffic and add to their overall connections.’
• ‘Despite the EU-China Comprehensive Investment Agreement inked in December 2020, however, that investment lane remains a construction site, as opposition has arisen in some member states and in the European Parliament, which ultimately have to sign off on a final deal. Road construction on that deal is likely to continue through 2021.’  

‘The commercial highway connecting the EU with the U.S., in contrast, looks more like a twelve-lane Autobahn.’

• ‘Not only are there fewer speed limits and an even wider lane for goods, there are additional lanes for services, investment streams and sales of companies on each side of the Atlantic.’
• ‘The transatlantic digital lanes carry 75 percent of global digital content. The innovation lanes hosting research and development flows are the most intense between any two international partners. The jobs lanes provide employment for 16 million Europeans and Americans.  

‘On each of these metrics, the ties that bind the EU to the U.S. are much thicker and far deeper than those that bind either to China.

My Take

‍U.S-European commercial ties may be like the Autobahn. Still plenty of Europeans are betting that that two-lane highway between China and Europe may be slower but it's going to be carrying a lot of gold.