China is exploring voluntary export restraints (VERs)
Context Our past article examined and summarized Dr. Stephen Miran, Chair of the Council of Economic Advisers at the White House, and explored his thesis “ A User’s Guide to Restructuring the Global Trading System. ” He argues that the ongoing overvaluation of the dollar, which disrupts the equilibrium of international trade, is the root cause of the economic imbalances, the “ Triffin Dilemma .” This article discusses the possibility that China may propose a voluntary export restraint as a strategy to counterbalance the tariffs announced by the White House and how Miran could respond to this. China’s Strategy China is exploring voluntary export restraints (VERs)—a self-imposed limit on how much of certain goods (e.g., EVs and batteries) it exports to the US—to: Avoid harsher US tariffs under Trump’s trade policy. Preserve market access while reducing political tension. Charge more per unit (export fewer but higher-value goods, like Japan did in the 1980s). Negotiate investmen...
