The US maintains restrictions on high tech exports to China because of the latter s lack of respect for intellectual property rights.

Making matters worse, African exports to China are even less technology intensive than its exports to the world.

China s government has clearly indicated that it will use any means necessary to backstop growth in the face of a free fall in exports.

China also attaches great importance to non proliferation export controls.

In fact, to meet the challenge of restructuring China s economy away from exports and resource intensive goods, China must stimulate consumption.

The ESCAP region is a major contributor to world trade growth, with both exports and imports growing faster than world exports and imports and with China becoming the world's third largest trading nation.

In the decade after 1999, China s share of total global exports rose from 5.1 to 12.4 .

In 1990, exports from China to the United States 15 billion dollars.

By contrast, the share of ordinary US exports to China shrank, suggesting that China s rebalancing is likely to be associated with continued large bilateral surpluses with the US.

Research shows that no more than 20 to 30 of Chinese exports to the US reflect value added inside China.

Indeed, China s 12th Five Year Plan is aimed at reducing dependence on exports and boosting domestic demand.

The big downside of the currency peg for Europe is supposed to be exports.

China s March trade deficit indicates, first of all, that it is incorrect to claim that Chinese economic growth depends mainly on exports.

In the process, it will shed lower value added jobs in its export sector as production moves to lower cost developing countries.

Between 2001 and 2008, export growth accounted for more than 40 of China s overall economic growth.

Yet Chinese leaders remain more zealous about promoting exports and economic growth than in protecting the country s air and water.

In China, a hard economic landing looks increasingly likely as the investment bubble deflates and net exports shrink.

Allowing the renminbi to appreciate as a way of encouraging imports may also discourage exports, the traditional motor of Chinese growth.

Central America and Mexico have been running bilateral deficits for years, with Mexico s import export ratio in 2006 at 16 1.

Robust exports from Japan and Europe supported economic recovery and steadied investor confidence, providing, in turn, further export opportunities for newly industrializing countries, most notably China.

In order to compete with China s export boosting public private schemes, other Asian countries are now pursuing similar policies.

Huge bilateral trade deficits, accusations that China keeps its currency undervalued, and a rash of defective and dangerous Chinese made exports have fueled a protectionist backlash in the United States and Europe.

Policies aimed at ensuring export led growth also include export subsidies and barriers to imports.

Ordinary exports are produced using Chinese factors of production, and ordinary imports are intended for China s internal market.

But there is another explanation for China s excessive export dependence, one that has more to do with the country s poor political and economic institutions.

This physical assertiveness followed often violent anti Japanese protests in China in September, while a continuing informal boycott of Japanese goods has led to a sharp fall in Japan s exports to China, raising the risk of another Japanese recession.

In recent years, the US absorbed half the world s capital exports, while China provided one fifth of the total.

As they prepare for the coming Chinese slowdown and seek to minimize the risk of regional destabilization, Asian economies must strengthen domestic demand and reduce excessive reliance on exports to China.

In 1993, advanced manufactured goods accounted for 50 of total exports to China, while raw materials and intermediate goods comprised the remainder.

America s net exports will have to increase, meaning that the net exports of China, Japan, and other surplus countries will consequently decrease.

Once again, China provides clear evidence of these patterns, with almost 60 of Chinese exports being produced by foreign corporations.

And it has a direct impact on European exports to the US.

The rest of its petroleum exports go to Europe and Latin America.

An important victim will be Japan, where anemic real income growth is depressing domestic demand and exports to China sustain what little growth there is.

But China has another motive for tightening the noose on rare earth exports it wants to force high tech firms to operate in China, so that local companies can absorb their technologies.

For Chinese manufacturers, a long term trend of rising costs coupled with a short term export slump were unprecedented challenges.

The Import of Exports

Export control

Exports

Exports to Japan were down by 5.7 , while exports to the US and the European Union decreased by 1.6 and by 9.7 , respectively, with both falling for three months in a row.

Japan accounts for only 5 of America s exports and 8 of China s.

Third, China has had to rely on another round of monetary, fiscal, and credit stimulus to prop up an unbalanced and unsustainable growth model based on excessive exports and fixed investment, high saving, and low consumption.

Second, German exports go mainly to the EU.

Indeed, 42 of Chinese exports go to Europe, the United States, and Japan three economies that are flirting with secular stagnation. And Europe, China s largest export market, has struggled the most.

Even so, the explosion of exports coming out of low wage regions like China and India is at least a piece of the puzzle.