Business and Trade Relationships between the United States and China - Term Paper Example

In due course of time, China becomes one of the top five trading partners of the United States and has become the largest market for the exported goods from China (Mann, 2000). The U.S companies have also been investing in China at a steady pace, especially during the past decade in avenues such as information technology. However, a closer look reveals that the trade relationship is not one that has been smooth throughout. There have been numerous instances where a considerable amount of tension has flared up between the two nations and these tensions have had an impact on the smooth progress of trade.

Social issues and policy issues have been some of the main reasons because of which smooth trade was often interrupted. Social and national issues such as China’s infamous massacre that happened at the Tiananmen Square, religious toleration, China’s position towards Taiwan, the sale of arm issue to rogue states, the prevalent communism et al. have affected the way in which both countries work as trade partners. Similarly, policy issues such as China’s hesitation to join the World Trade Organization (formerly known as world trading system) and so on also proved to be further barriers (Garver, 1992).

Once many of these issues were tackled, the trade between these two nations flourished. It required a great deal of bilateral collaboration between the two countries to move ahead in the direction of business cooperation. Therefore, it is interesting to understand the aspects that come into play and influence the trade relationships between two different countries. As the business relationship between these two nations has gone through many high points as well as low points, it has been an interesting topic of study for many researchers throughout the world.