U.S.-China Relations: Great for TV, but Greater for the U.S. Economy

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United States Department of Commerce Dec 15, 2014

Frank Underwood doesn’t understand the purpose of the U.S.-China Joint Commission on Commerce and Trade (JCCT).

Maybe you know of Frank Underwood, the main character on the show House of Cards, played by Kevin Spacey. If so, you may remember how he conspired with colleagues in the White House and State Department to orchestrate a trade war with China. 

How did he do it? Through the JCCT negotiations. 

While Mr. Underwood is commonly known in the United States, it’s much less likely that the average American knows what the JCCT is, aside from it being some way for a fictional administration to create tension with a major U.S. international partner. 

Though it isn’t a household term, the importance of the JCCT can’t be overlooked. While Mr. Underwood used the JCCT to start a trade war, the reality is that the United States and China use it to support trade peace – resolving bilateral tensions and exploring areas of mutual cooperation. 

The United States and China established the JCCT in 1983 as the primary forum for addressing trade and investment issues, and promoting commercial opportunities between the two countries. 

The JCCT has since resulted in significant progress on issues U.S. businesses have identified as priority concerns in China, including:

* protection and enforcement of intellectual property rights;

* government procurement;

* standards, testing, and certifications; and

* issues specific to certain sectors like information technology, energy, and travel and tourism. 

Improving American businesses’ ability to compete on a level playing field in China through the JCCT and other bilateral engagements has contributed to growth of U.S. exports and business activity in China’s market, supporting the American economy and job growth. It has also helped drive important reform in China’s economy, supporting innovation and growth there as well.

The next round of high-level JCCT Meetings are in Chicago this month and we’re looking forward to using this opportunity to address bilateral trade concerns and deepen positive economic engagement between our governments and commercial sectors. 

Why does JCCT matter to the average U.S. citizen?

* China is our second largest trading partner. U.S. total exports to China have nearly tripled since 2005, reaching $122 billion in 2013.

* U.S. goods & services exports to China support nearly 796,000 U.S. jobs.

* Continued growth in China’s middle class will create even more promising export opportunities for U.S. companies.

* To continue with Mr. Underwood’s example, China is now the top goods export market for his home state of South Carolina. The state’s goods exports to China reached $4.9 billion in 2013, which is nearly eight times greater than in 2005. 

Lastly, not to quibble with the House of Cards writers, the show makes one important error: the Secretary of State was in charge of the JCCT discussions, and provided guidance to the U.S. team of negotiators. 

In fact, that team would have been led by the Secretary of Commerce and the U.S. Trade Representative. Secretary Pritzker and Ambassador Froman will lead the U.S. delegation and be joined by U.S. Secretary of Agriculture, Tom Vilsack. The Chinese delegation will be led by Vice Premier Wang Yang. 

While we have yet to see those officials portrayed in the show, we look forward to seeing them play prominent roles in upcoming seasons. 

More importantly, we look forward to the 25th JCCT this month, and to seeing the continued positive effects these important meetings have on the U.S. and Chinese economies and our commercial relationship.