The Trump administration often cites America's trade deficit with China as "losing." But experts say it's a huge miscalculation in the highly globalized world and that China never profited that much from its trade surplus with the US.

Migrating production lines to China and then shipping the products out to other countries or back to the United States – that's how American companies cut costs and boost profits over the years. But that's all counted as China's exports that lead up to a big literal trade surplus. In that trade model, China makes only a small portion from processing and packaging. 

"Foreign-invested companies here, including American businesses, have been contributing more than half of China's trade surplus with other countries, even as much as 84 percent in 2011. The percentage dropped in recent years but is still above 50 percent. Domestic companies actually profit less from country's trade surplus," said Xu Xianchun, director for China Data Center at Tsinghua University.

Washington also neglected American companies' revenues made from Chinese markets, which is not calculated in the trade numbers. 

Last year, General Motors sold over four million cars in China along with its joint venture. The company's sales in the Chinese mainland increased by 12 percent to take up 42 percent of the total in the third quarter, while in the US, revenues declined by 20 percent.

"President Trump lowered taxes to lure businesses back to the US to create jobs and boost GDP. That way of thinking overlooked the fact that nowadays companies' investments overseas can often get higher returns thanks to globalization and rapidly growing demand in emerging economies such as China," said Tu Xinquan, Dean of China Institute for WTO Studies at University of International Business and Economics.