WASHINGTON — The International Monetary Fund (IMF) has released a new analysis refuting concerns that China’s external surpluses are primarily the result of its industrial policies. The report emphasizes that trade balances in China and the United States are largely influenced by domestic macroeconomic factors rather than specific trade or industrial strategies.

According to Namibia Press Agency, the analysis authored by IMF Chief Economist Pierre-Olivier Gourinchas and three other economists, published in a recent blog, argues that external balances are fundamentally shaped by macroeconomic fundamentals. The IMF team pointed out that while China’s subsidies focus on sectors like software, automobiles, transportation, semiconductors, and green technology, the nation’s manufacturing trade surplus is not concentrated in any specific industry. This suggests a broader economic dynamic at play rather than targeted industrial maneuvering.

The analysis further notes that China’s economic footprint on the global stage has grown significantly, making its trade movements notably impactful worldwide. Despite a smaller trade surplus relative to its GDP compared to the early 2000s, China’s global economic influence remains strong. The IMF economists highlighted that the enduring nature of China’s trade surplus, stable as a percentage of global output over time, continues to have substantial spillover effects on the global economy.

The report also delves into the factors that have contributed to China’s increased trade surplus post-COVID-19, identifying key domestic challenges such as the downturn in the property market and low household confidence. In contrast, the U.S. has experienced a dissaving shock attributed to high levels of government and personal spending. The IMF suggests that these complex interplays of domestic economic activities demand tailored solutions from within rather than external pressures or adjustments.