Discrepancies in Trade Statistics between the United States and China Have Decreased, Joint Report Shows

Washington, DC - The U.S. Department of Commerce today released findings [3]on the differences between the official trade statistics produced by the United States and China. The Second Phase Report on the Statistical Discrepancy of Merchandise Trade between the United States and China [3] is an update to a March 2010 report prepared cooperatively by analysts in the United States and China as part of the U.S.-China Joint Commission on Commerce and Trade Statistics Working Group (JCCT SWG).  The report was signed at the 23rd meeting of the Joint Commission on Commerce and Trade held in Washington, D.C. in December 2012, and is being released for the first time today.

The United States and China each publish data that measure the bilateral merchandise trade flows between the two trading partners.  Although both countries follow international statistical standards, discrepancies in the merchandise trade statistics arise as a result of data and methodological differences. 

 “This joint report between the U.S. and China helps us to better understand the trade dynamics between our two countries, and to properly account for imports and exports,” said Deputy Secretary of Commerce Rebecca Blank. “Creating a healthy and balanced trade relationship with China is important to the United States, and being able to accurately measure the trade between our two countries is an important component of that effort.”

 The working group found that, although the total value of imports and exports between the two countries has increased with the growth in bilateral trade, the statistical discrepancy in percentage terms has decreased. Most of the discrepancies (80-90 percent) arise from eastbound trade (trade from China to the United States).  Westbound discrepancies ranged from approximately 8 to 10 percent of the discrepancy total. 

 In 2008, the eastbound statistical discrepancy based on officially published data was $85.4 billion, but after applying estimates for the agreed upon explanations of the difference, the discrepancy was decreased to $24.5 billion.  Subsequent discrepancies in 2009 and 2010 were reduced from $75.6 billion and $81.7 billion to $27.1 billion and $27.3 billion, respectively.

Chinese-U.S. Bilateral Merchandise Trade Statistics

2008, 2009, and 2010

(Values in Billions of U.S. Dollars)

A significant portion of the discrepancy in trade figures involve goods that are shipped indirectly via intermediary countries, such as Hong Kong. Value added from further processing, repacking or a simple price markup when the goods are resold in the intermediary countries contributes to the discrepancy.

The working group determined goods that are shipped directly from China to the United States without entering the commerce of another country or region also contribute in large part to the discrepancy. These shipments often possess higher import values when declared to U.S. Customs because of price markups by intermediary parties. The markups occur more often with processed goods compared with general goods.

The goal of this study was to clarify differences in reporting, thereby facilitating a better understanding among data users of the actual trade situation. The research is based on the published bilateral merchandise statistical data in the calendar years 2008, 2009 and 2010, compared with the previous study that used data covering years 2000, 2004 and 2006. 

The working group consisted of the Ministry of Commerce of the People’s Republic of China, the Chinese General Administration of Customs, the U.S. Economic and Statistics Administration, Office of the U.S. Trade Representative and the U.S. Census Bureau. 

A copy of this report can be found at <http://www.esa.doc.gov/Reports/second-phase-report-statistical-discrepancy-merchandise-trade-between-united-states-and-chin [4]>.

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