‘China’s rise’ not primary driver of job losses in rich countries: IMF

Automation, rather than market competition from China, can be blamed for regional job losses suffered in developed countries, including American rust belt states, according to new research by the International Monetary Fund (IMF) released on Wednesday, reported the South China Morning Post.

“Increases in import competition in external markets associated with the rise of China’s productivity do not have marked effects on regional unemployment,” the Washington-based fund said in an academic paper. “Only technology shocks tend to have lasting effects, with even larger unemployment rises for vulnerable lagging regions.”

The paper, which looked at regional disparities within advanced countries, undermines a key argument pushed by US President Donald Trump in the ongoing trade war between Washington and Beijing – that China has been stealing American technology and jobs.

Although the research did not mention Trump, the IMF said the argument that market competition displaced jobs was flawed as imports from China could only cause job losses in the near term and such impact “quickly abates.”