U.S.-China trade frictions will kill U.S. jobs: Alibaba's Jack Ma

The Wall Street Journal and the South China Morning Post have published a signed article by Alibaba's CEO Jack Ma, who says the current trade frictions between the United States and China will "kill" the jobs, opportunities and hope.

A signed article by Alibaba's CEO Jack Ma is posted on the Hong Kong-based South China Morning Post. [Screenshot: China Plus]

In the signed article, Jack Ma poses a question to the United States and the administration of President Trump, namely, whether the United States is ready to give up its great opportunity to access the world's largest consumer market.

Ma contends that millions of farmers and small businesses in the United States would be the ultimate victims of the so-called trade war, and that instigating a trade war with China would not be good for the United States economy overall.

Jack Ma took the Gateway '17 conference held by Alibaba in Detroit last year as an example, saying "(American) Small-business owners and farmers traveled from all over the country to learn how Alibaba could connect them to the massive Chinese consumer market." He notes that once the trade war starts, American small business owners and farmers will be hurt, and this deviates from Trump's intention to protect local jobs.

Jack Ma, CEO of Alibaba, speaks at the company's inaugural Gateway '17 conference in Detroit, the United States, on Wednesday, June 21, 2017. Gateway '17 is designed to help American businesses, farmers, and entrepreneurs explore growth opportunities in China and learn how to market and sell to millions of Chinese consumers. [Photo: VCG]

In the meantime, it is Ma's view that it's a mistake to regard the trade deficit as an injury to a country's economy. He says in his opinion piece, "The U.S. has a structural trade deficit with China because of the market forces of comparative advantage: Economies produce what they are best at making and import other things. Dollars earned from trade surpluses in China have been recycled to finance American borrowing, keeping U.S. interest rates low with favorable economic conditions."

Furthermore, he argues that over the past 30 years, American economic policy has encouraged its companies to outsource labor-intensive manufacturing to China and other Asian countries; however, the country has kept the most valuable parts onshore, including innovation, technology, and brand. In other words, American companies have taken most of the profits, and the United States has maintained the world's largest profit margin.

Visitors admire a robot at Gateway '17 in Detroit, the United States, on Wednesday, June 21, 2017. [Photo: Xinhua]

Figures released by the United States Department of Labor show that the country's unemployment rate stood at a 17-year low of 4.1 percent in March. Ma says that this, along with other economic indicators, "suggests that the U.S. economy is doing well, regardless of the trade deficit."

Lastly, Jack Ma says he still has confidence in the future of the China-U.S. economy over the next 20 years. He ended by sharing with readers the mission of Alibaba, "At the heart of Alibaba's mission - to make it easy to do business anywhere - is our support for small businesses… Alibaba will continue to help American small businesses and farmers access the Chinese market."