US Presidential Election 2008: Policy Implications for US—China Trade and Investment

The next US president will be elected in November 2008. Since the relative stabilization of war in Iraq, the economy has become the national priority of the 2008 US election. In their campaign efforts, the Democrats have enjoyed greater momentum than the Republicans, in terms of polls, fund‐raising and corporate support. After the Bush era, the next president will seek to restore America's leadership and to engage in multilateralism. Since the 1990s, China has been the most rapidly‐growing US export destination. In terms of US—Chinese trade and investment, the next president, if a Democrat, will, among other issues, review trade agreements and has pledged to co‐sponsor legislation that would allow US companies to seek anti‐dumping duties on Chinese imports based on the perceived undervaluation of the Chinese currency. If a Republican, the next president will support global integration and oppose protectionist measures. The Democratic Congress is likely to oppose Republican policies in general and free trade policies in particular. Both scenarios imply increasing pressure on US—Chinese trade and investment relationships. Because these two nations now account for almost half of global growth, the state of the futureUS—Chinese bilateral relationship has worldwide implications.