贸易战：中国的制胜之道（中国宏观策略）

1、Contents HYPERLINK l _bookmark0 Executivesummary2 HYPERLINK l _bookmark2 The tradewar bites5 HYPERLINK l _bookmark3 China-US trade tensions have taken a toll oneconomic growth5 HYPERLINK l _bookmark4 Trade diversion and supplychain relocation6 HYPERLINK l _bookmark5 Technological rivalry is more ofa

2、concern11 HYPERLINK l _bookmark6 Reflatingdomestic demand13 HYPERLINK l _bookmark7 Loweringcorporate tax13 HYPERLINK l _bookmark8 Credit easing targets theprivatesector14 HYPERLINK l _bookmark9 Issuing more special bonds to financeinfrastructureinvestment16 HYPERLINK l _bookmark10 Focusing on ICT an

3、d green investment16 HYPERLINK l _bookmark11 Speeding upstructuralreforms18 HYPERLINK l _bookmark12 Structural reform unlocks domestic demand18 HYPERLINK l _bookmark13 Competitive neutrality key to revitalising theprivatesector19 HYPERLINK l _bookmark14 Intellectual property rights protection essent

4、ialforinnovation22 HYPERLINK l _bookmark15 The private sector benefits from successful andfaster reform25 HYPERLINK l _bookmark16 Furtheropeningup27 HYPERLINK l _bookmark17 Morediversification27 HYPERLINK l _bookmark18 Deepening globalinnovation29 HYPERLINK l _bookmark19 Becoming a more attractiveFD

5、Idestination31 HYPERLINK l _bookmark20 Keyrecent publications33 HYPERLINK l _bookmark21 Disclosureappendix34 HYPERLINK l _bookmark1 Disclaimer36The trade war bitesTrade tensions have taken a toll on exports and economic growth in China, and will likely remain as a major challengeaheadSupply chain re

6、location should hurt GDP growth and employment,but“pull” factors may incentivise manufacturers to stay in ChinaProlonged technological rivalry could be more disruptive, as it would slow the technology “catch-up” process as well as productivitygrowthChina-US trade tensions have taken a toll on econom

7、ic growthChinas trade with the US slowed significantly since late2018Although there was some “front-loading” after the trade tensions were first felt in 2018, Chinastrade with the US has slowed significantly since the 10% tariff on USD200bn of China importstook effect in September 2018 (see Chart 1)

8、. In the first five months of 2019, Chinas exports to the US contracted by 9% y-o-y, creating a material drag on total export growth. Faltering global demand and suppressed business sentiment added to the weakness in export growth. As we can see in Chart 3, even the remaining China exports to the US

9、 that have not been tariffed (the grey line) have been growing at a slower pace since late 2018.Chart 1: China export growth by destinationChart 2: Import growth decelerating at a faster pace than export growth16 Contribution, ppt 1284YoY%,80604020YoY%, 3mma800-4 EU Sep-18USMar-1900-20-40JapanSouthK

10、oreaHong07 08 09 10 11 12 13 14 15 16 17 18 19OthersGrowth (%y-o-y)ExportgrowthImportgrowthSource:CEIC,HSBCSource: CEIC,HSBCThe tariffs, if here to stay, are likely to continue to suppress trade growthMeanwhile, Chinas import growth has been decelerating at an even faster pace (see Chart 2). In part

11、icular, purchases of capital goods such as mechanical and electrical equipment and intermediate goods have shrunk significantly, pointing to a potential future slowdown in manufacturing production in some externally-oriented sectors.The tariffs, if here to stay, are likely to continue to suppress tr

12、ade growth. The recent increase in tariffs from 10% to 25% on USD200bn of Chinese products could cut Chinas total export volume by 1.7-2.8ppt in the next 12 months, which would translate into a 0.3-0.5ppt loss in headline GDP growth, on our estimates. If the US slaps 25% tariffs on the rest of China

13、sexports to the US, then the impact on total exports in volume terms could be 6.3-6.8ppt, which would lead to around 1.1-1.2ppt loss in headline GDP growth. But the actual loss to GDP could be smaller, as we expect Beijing to step up stimulus to reflate domestic demand, which can partly offset the n

14、egative impact from the trade war.The door for negotiating a trade deal to de-escalate the tariff war is still open, but the gap between the two sides is substantial. The recent move by the US to put Chinese technology companies on a blacklist is even more worrying. Rising risks for a prolonged econ

15、omic and technological rivalry between China and the US may have meaningful implications on Chinas economic growth in the medium to long term.Chart 3: China shipments to the US of items on US tariff listsUSD16bnlistUSD 200bnlist0% y-o-yUSD 34bn listeffective on 23 Aug effective on 24 Sepy-o-y %40302

16、0100-10-20-30-40effective on 7 JulyJul-17Sep-17Nov-17Jan-18Mar-18May-18Jul-18Sep-18Nov-18Jan-19Mar-19effective on 7 JulyUSD 200bntarifflistThe remaining China exports to theUSUSD 34bntarifflistUSD 16bn tarifflistSource: United States International Trade Commission (USITC), HSBCTrade diversion and su

17、pply chain relocationThere is some evidence of “trade diversion” to other countriesWe measure the scale of potential supply chain relocation and its impact on GDP and employmentAs US imports from China drop, there is evidence of “trade diversion” to other countries. We compare growth of US imports f

18、rom China and the rest of world for items covered in four US tariff lists. For items that are covered in the first USD34bn tariff list which took effect from 7 July 2018, the import substitution effect has become quite obvious. US imports from other countries have been rising at a faster pace, makin

19、g up for part of the drop in imports from China (see the first chart in Chart 4). The breakdown shows that the US has been importing more labour- intensive products such as furniture and garments from countries such as Vietnam and India. For products such as mechanical appliances and electrical mach

20、inery, the US has been purchasing more from places such as Mexico, Japan, Korea, and the European Union.If the US tariffs are here to stay over the medium term, a key risk is that manufacturers may reshuffle their production to other countries in order to get around the tariffs. The market has been

21、concerned that this may create a significant loss in Chinas GDP growth over the medium term. We provide an analysis here to measure the trade wars potential impact on manufacturing supply chains in China.Chart 4: US imports from China and the rest of world covered by recent US tariff listsUSD 34bn t

22、ariff listContribution to y-o-y % change, ppt121086420-2-4-6Jan-18Apr-18Jul-18Oct-18Jan-19China RoW50USD 16bn tariff listContribution to y-o-y % change, pptJan-18Apr-18Jul-18Oct-18Jan-19ChinaRoWUSD 200bn tariff list25 Contribution to y-o-y % change, ppt 20151050-5-10Jan-18Apr-18Jul-18Oct-18Jan-19Chi

23、na RoWRemaining US imports from China16 Contribution to y-o-y % change, pp2-4-6Jan-18Apr-18Jul-18Oct-18Jan-19China RoWSource: USITC, HSBC. Note: Red dashed lines in the charts denote effective dates for US tariffs. 25% tariff on the USD34bn product list took effect on 7 July 2018. 25% t

24、ariff on the USD16bn list took effect on 23 August 2018. 10% tariff on the USD200bn list took effect on 24 September 2018 and was raised to 25% on 10 May 2019.Source: USITC, HSBC. Note: Red dashed lines in the charts denote effective dates for US tariffs. 25% tariff on the USD34bn product list took

25、effect on 7 July 2018. 25% tariff on the USD16bn list took effect on 23 August 2018. 10% tariff on the USD200bn list took effect on 24 September 2018 and was raised to 25% on 10 May 2019.We find that 5% of Chinas manufacturing production is exposed to the US marketUsing the World Input-Output Databa

26、se (WIOD, 2014), we find that 5% of Chinas manufacturing production is exposed to the US market. This comprises c2% that are direct exports to the US and c3% that are intermediate goods used in production of exports to the US (see Chart 5). Meanwhile, 24% of manufacturing production is exposed to th

27、e rest of world (RoW) about 11% that are direct exports to the RoW and c13% that are intermediate goods used in the production of exports to the RoW. The remaining 71% of manufacturing productionChart 5: ChinamanufacturingproductionChart 6: China industry and servicesvalueadded2% 3%Domestic output a

28、s exports to the US11%13%71%Domestic production supportingexportstotheUS11%13%71%Domestic output as exportsto the RoWDomestic production supporting exports to the RowDomestic production for domestic demandDomestic value added in exports to the US4%12%84%Domestic value added in4%12%84%exports to RoWD

29、omestic value added in domestic final demandSource: World Input-Output Database (WIOD, 2014), HSBC Note:RoWmeansrestof theworldexcludingChinaandtheUS.Source: Trade in Value Added (TiVA) database (OECD, 2015), HSBC Note: RoW means rest of the world excluding China and the US.“Push” factors incentivis

30、e manufacturers to move production, while “pull” factors make companies stay in Chinais to satisfy domestic demand. Using the OECDs Trade in Value Added (TiVA) database, we find Chinas industry and services value added in exports to the US is slightly smaller, accounting for 4% of Chinas total value

31、 added (see Chart 6).In other words, if the US implements tariffs on all imports from China, it could affect as much as 5% of total manufacturing production in China. However, in reality we do not think all of this 5% of manufacturing production will move out of China. HSBC equity strategists have a

32、rgued that there are five factors that can drive shifts in supply chains capabilities within a production network/industrial cluster, proximity to the end market, costs, risk, and finance availability (see Herald van der Linde, Retooling Asia supply chains: Not so fast II, 12 February 2019). While s

33、ome of the factors, such as rising costs and risks due to higher labour prices and trade tensions, may become “push” factors that incentivise manufacturers to move production to lower labour cost, no-tariff countries, there are also “pull” factors that make companies stay in China. For example, Chin

34、as large domestic market is still an attractive factor for many businesses. In fact, most manufacturing sectors in China have rather small exposure to the US market and are more dependent on the domestic market (see Chart 9 and Chart 10).Moreover, for sectors such as electronics and electrical equip

35、ment, other “pull” factors may also matter, such as Chinas significant advantages in industrial capabilities, including the availability of skilled labour and in-time local supply of components. China has moved beyond assembling imported inputs into final products. It now produces more intermediate

36、goods and builds more vertically integrated domestic industries. In computers and electronics, for instance, Chinas production of electronic components as a share of total ICT production has been rising over the previous two decades (see Chart 7). While low-tech and low-value-add production such as

37、electronics assembly may be more easily moved to another country, activities that require skilled workers and a reliable local supply of components may take longer to relocate.Chart 7: Composition of ICT goods exports from China100%Chart 8: Chinas IC imports by source vs. Chinas total IC exportsUSDb

38、nUSDbn2000 0204 0608 1012 14 1602010 2011 2012 2013 2014 2015 2016 2017 2018350300250200150100500MiscellaneousComputers and peripheralequipment Consumer electronic equipment Communication equipment ElectroniccomponentsImportsfromRoWImports fromUSImportsfromJapanImportsfromMalaysia Imports fromSouthK

39、oreaImports from Taiwan Total ChinaexportsSource:UNCTAD,HSBCSource: International Trade Centre (ITC),HSBCBased on the “push” and “pull” factors we discussed above, we have created an integration factor that measures the possibility of relocation of manufacturing production that is exposed to the US

40、market. The factor ranges from 0 to 1, and a higher score denotes the greater possibility of manufacturing production moving out of China. In the worst case scenario, we assume the integration factor of all manufacturing sectors equals 1, which means that the 5% of manufacturing production exposed t

41、o the US market will move. This gives us a maximum GDP loss estimate of around 1.5ppt (see Table 2).Chart 9: Use of China manufacturing output by sector (ranked by output level)Basic Foodproducts,beveragesandtobaccoproducts Computer,electronicandopticalproductsTextiles,wearingapparelandleatherproduc

42、ts Motorvehicles,trailersandsemi-trailersMachinery and equipment Electrical equipmentOther non-metallic mineral products CokeandrefinedpetroleumproductsFabricated metal products RubberandplasticproductsProductsofwoodandcork,exceptfurnitureOther transport equipmentPaperandpaperproducts04008001,2002,0

43、00Domestic demandDoemstic intermediate useExports to USExports to RoWUSD bnSource: WIOD, HSBCof by by Computer, electronic andopticalproducts Textiles, wearing apparel and leatherproductsElectricalequipment Machineryandequipment Fabricatedmetalproducts Rubber andplasticproducts Paper and paperproduc

44、tsMotor vehicles, trailers andsemi-trailersOther transportequipmentProducts of wood and cork,exceptfurniture Other non-metallic mineralproductsBasic Food products, beverages andtobaccoproducts Coke and refined petroleumproducts0% 10% 20% 30% 40%50% 60% 70% 80% 90% 100%DomesticdemandIntermediate use

45、ofdomesticoutputExportstoUSExports toRoWSource: WIOD, HSBCRealistically, however, it is difficult to see the worst case scenario happening given the “pull” factors discussed above. Therefore, in the base case scenario we assign an integration factor to each manufacturing sector based on a comparison

46、 of “push” and “pull” factors in each sector.For example, in the furniture sector, domestic demand accounts for only a small share of total output, while profit margins are sensitive to rising labour costs in China. We believe that “push” factors in the furniture sector are greater than “pull” facto

47、rs, and the sector is more prone to supply chain reshuffling as a result of US tariffs. Therefore its integration factor is relatively high. In the following table we list each sectors exposure to the US market and their respective integration factor in our base case scenario.Table 1: Manufacturing

48、sectors exposure to the US market and integration factorSectorsDirect and indirect exposuretothe US market(%)Integration factor (0-1)Furniture26.50.7Computer, electronic and optical products15.00.6Textiles, wearing apparel and leather products11.90.7Electrical equipment6.60.6Rubber and plastic produ

49、cts5.20.7Machinery and equipment5.10.6Fabricated metal products4.70.5Chemicals and chemical products3.80.5Paper and paper products3.80.5Products of wood and cork, except furniture3.00.5Basic metals2.40.4Motor vehicles, trailers and semi-trailers2.20.4Coke and refined petroleum products2.00.4Other tr

50、ansport equipment1.90.3Pharmaceuticals1.80.3Other non-metallic mineral products1.50.3Food products, beverages and tobacco products1.40.2Total manufacturing sector5.30.6Source: WIIOD, HSBC. Note: Direct and indirect exposure to the US market for each sector here is also the maximum share of productio

51、n that may be moved out of China due to US tariffs. Integration factor measures the possibility of relocation of manufacturing production that is exposed to the US market.In the base case scenario, we find that cumulative GDP loss caused by supply chain reshuffling is around 1.0pptIn the base case s

52、cenario, production loss will be the sum product of each sectors production exposure to the US and the respective integration factor. As shown in Table 2, in the base case scenario we find that cumulative GDP loss caused by supply chain reshuffling is around 1.0ppt. This will also likely create a sh

53、ock to employment in China. Assuming a 1ppt GDP loss would lead to a 0.5ppt loss in employment, we think lay-offs in the base case scenario could amount to around 4m jobs. While this is not negligible, we believe that as Beijing still has plenty of room to step up stimulus (see the following chapter

54、), it could partly offset the negative impact from the supply chain relocation. As we expect policy stimulus to support Chinas infrastructure investment, a lot of the potential lay-offs from manufacturing could be absorbed by the construction sector. Moreover, supply chain reshuffling may have an im

55、pact on non- manufacturing sectors. However, we believe it would be rather limited as non-manufacturing sectors in China are mostly domestically-oriented and the spillover would be largely offset by policy stimulus.Table 2: Impact of supply chain relocation on GDP and employmentManufacturing product

56、ionloss(ppt)Headline GDP loss (ppt) Employment loss (mjobs)Base case scenario3.01.04.0Worst case scenarioSource: WIOD, HSBCTechnological rivalry is more of a concernThe US move to add China tech companies to the Commerce Departments Entity List could be disruptiveThe US ban on technology companies m

57、ay hinder innovationAs we argued above, Chinese companies are producing more electronics components that were once imported from advanced economies. However, China still relies on foreign supplies for some core technologies. The country remains a net importer of various types of electronic parts and

58、 components, such as chips, semiconductors, and precision equipment (see Chart 8). Therefore, the recent move by the US to add Chinese technology companies notably Huawei and its 68 affiliates to the US Commerce Departments Entity List could be disruptive. The listing effectively bans US suppliers f

59、rom selling parts and services to Chinese technology companies without a licence from the Commerce Department.The ban will likely cause disruptions in production of these technology companies. To maintain its operations, Huawei would have to find a substitute from non-US suppliers for all components

60、 and services that it used to import from the US. This will be difficult given the complexity of the technology supply chains. For Huaweis production of smartphones, for instance, HSBC technology research team assesses that Chinese companies can provide a similar level of quality in some components.