US-China trade hits record high despite rising tensions || WORLD NEWS

Trade between the US and China hit a record high last year even as their diplomatic relations reach new lows

Tensions rose between Washington and Beijing in recent days after a Chinese balloon traveled across the US.

The world's two biggest economies have been locked in a bitter trade war since 2018 when then-President Donald Trump started imposing tariffs on China.

The new figures show that US imports from China increased to $536.8bn last year as American shoppers spent more on Chinese-made goods, including toys and mobile phones. In the same period, US exports to China increased to $153.8bn.

While some of the increase in trade between the two countries is a result of the rising cost of living, the figures also point to how reliant the US and China still are on each other even after years of the trade conflict between them.

"I think it's an important indication of the difficulties of actually decoupling," Deborah Elms, the founder of the Asian Trade Centre, told the BBC.

"Even if governments, firms, and consumers wanted to separate, the economics make it difficult to deliver products in a decoupled world at a price that firms and consumers are willing to pay," she added.

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In 2018, the Trump administration started to ramp up trade measures against Beijing.

After decades of rising Chinese imports, Mr. Trump began imposing tariffs on a total of more than $300bn worth of Chinese goods. China hit back by placing import levies on about $100bn of American goods.

Most of those measures remain in place more than two years after Joe Biden became president.

This month, US Secretary of State Antony Blinken had been due to visit China in what was seen as a thawing of relations between the two countries.

America's top diplomat was set to visit Beijing from 5 to 6 February to hold talks on a wide range of issues, including security, Taiwan, and Covid-19.

However, the trip was abruptly postponed after the discovery of a suspected Chinese surveillance balloon that drifted across America.

Chinese officials have repeatedly said that the "airship is for civilian use and entered the US due to force majeure - it was completely an accident".

In his State of the Union address on Tuesday: US President Joe Biden made no direct mention of the Chinese balloon but said that his administration will always protect its sovereignty.

"I am committed to working with China where it can advance American interests and benefit the world. But make no mistake: as we made clear last week, if China threatens our sovereignty, we will act to protect our country. And we did," he said.