The China-United States Trade War
China and the US are considered to be the largest economies in the world. The world economy depends heavily on the decisions made by the two powers. However, recent years have seen the two powers getting into conflicts over trade deals leading into a trade war. The taking over of Donald Trump as the president of the US has seen the relationship between the US and China deteriorate to alarming rates. The US under Trump’s leadership has been implementing trade tariffs since 2018, and Chine has not been taking the move lightly. The claim made by Trump on the tariffs is that China has been employing unfair tactics making the US struggle to remain in sustainable trade. The trade strategies that have been a cause for concern from the US include ones that have been causing trade deficits, theft of intellectual property by China, and forced transfer of American technology to China. The China-US trade war features a struggle for the removal of trade tariffs by the US as well as the use of fair-trading strategies by China, and the conflicts continue to shift to a new direction every day.
Involvement of Trump in Worsening the Trade War
The China-US trade was made worse by Trump’s introduction of trade tariffs to counter the growing concern over China’s unfair trading strategies. China-US diplomatic relations had been going on smoothly before the US government started blaming China for its challenges in the economic sectors (Lee, 2019). The relationship between the two powers has been based on mutual trade benefits, such as working as trade partners for a long time. The US, for example, has been among the top three trade partners with China appearing among the top fifteen trade partners with the US. However, the trading deficit grew significantly in the US, raising concerns on the long-term status of the US economy. The US has, in recent years, grown to be the largest importer in the world, while it remains the largest exporter, and the structure has been seeming costly for the US. The efforts by Trump included coming up with strategies to improve the manufacturing sector to avoid what he termed as “ripping off” by US trade partners. The main issue that surrounded Trump’s presidential campaign on the issue of international trade was to come up with tariffs that would see the US maintain her position in the international trade sector. Also, the alienation of Trump towards economists who have been for the argument that trade tariffs should be embraced has seen the president unwilling to relent on any matters to do with the international trade issue. Moreover, trade tariffs have proven to be the cause of conflict leading to the China-US trade war.
Contribution of Tariffs to US-China Trade War
The introduction of tariffs has brought a negative contribution to the trade of products between the US and China. Generally, the tariffs set between the two powers have been increasing the cost of doing business across the two nations. The main reason behind the setting of tariffs has been to improve local industries (Lau, 2019). In the US, for example, the government has been trying to save the domestic manufacturing industry from the impacts of excessive importation. China, on the other side, has been using the tariffs to save domestic consumers from the impacts of excessive exports. However, the issue of tariffs has not given the expected results. Instead, both countries have suffered from consequences that have led to a need for setting a deal that will benefit both nations. The US, for example, has seen farmers and other producers suffering from the impacts brought about by earlier tariff introduction. Farmers and manufacturers have struggled to find a market for their products as well as obtaining raw materials. Also, the consumers have suffered from high prices as producers, race towards catering for loses caused by the costs. Besides, both China and the US have been involved in a tit-for-tat system of conflict with both countries aiming at protecting their economy from the impacts of lenient trade deals. Furthermore, the impact has been felt internationally, and criticism has been coming from different parts of the world, although the governments have not been willing to make a deal. Also, domestic criticism from farmers and producers has been witnessed, although most Americans have been said to be in support of Trump. Unfortunately, Trump has promised that more tariffs and policies are yet to be introduced, and thus, a solution is not to be expected any soon.
Why a Solution is not to be Expected
A deal between the US and China that would bring the temperatures down does not appear to be on the plans of leaders of both nations. President Donald Trump has confidently threatened that the situation can only get worse with more tariffs being expected. China, on the other side, has accused the US of launching the war and that the US should initiate any form of discussion. Furthermore, China has held to the position that no discussions can take place with the current sanctions set by the US to disadvantage China from conducting free trade (Xing, 2018). Generally, economic heavyweights cannot be compelled into getting into a deal. The US and China do not need to get into a deal that does not have a mutual benefit. Therefore, the benefit that will be enjoyed by the two powers has been the reason that a deal has not been coming through. Also, the US has been forcing China into getting into an agreement, but China is not ready. Activities between the two countries have been unfolding negative progression on the attempts to reach an agreement. For example, September 2019 saw significant activities, with China setting new tariffs that would be countered on the same day by the US. Consumer goods have been the most targeted products, and economies of both countries have equally been suffering. The nearest level that the two sides have gone into reaching an agreement has been in October 2019 when the US agreed to lift some of the tariffs set on Chinese products with the requirement that China would provide a market for farm products from the US. However, the deal appeared to lack confidence from the Chinese end, adding further doubt on the authenticity of the deal. Moreover, a more plausible deal should see both parties have their interests treated with the respect they deserve.
Details of a Plausible Deal Between China and the US
A deal between the US and China can only be plausible if both parties have significant benefits to get in return after accepting the deal. Both parties have a lot to do to make the deal come to pass, and the efforts required require that each party has to work towards achieving a particular goal (Mahadevan & Nugroho, 2019). Damage has already been done, and the parties cannot just agree to reverse the impacts of the trade war. For example, the US cannot decide to remove all the tariffs at once, hoping that the situation will go back to the pre-trade war era. Also, China cannot at once decide to withdraw the counter-tariffs, believing that the relationship between the two powers will go back to where it was before the war. First, the two powers have to admit that their diplomatic relations are on the brink of collapsing. The powers need first to restore their diplomatic conflicts that have been caused by the trade war before proceeding to come up with a deal. After the diplomacy between the two powers is set, an analysis should be done to assess the bargaining benefits of the two powers. Each party should assess whether they are comfortable with the benefits promised by the deal and that the benefits are on the positive end of supporting the deal for the unforeseeable future. Generally, no party should be planning to take advantage of the other party as that will make the deal to fail before it is implemented. Unfortunately, history has shown that a deal may not be on the be shortly.
Impact of History on the China-US Trade War
A successful deal depends entirely on the history held by both parties and whether both or either party is willing to change their history. The reason behind the consideration of history is that every nation follows a particular pattern that comes from history, and any commitments have to be based on the already-established patterns. China is known for having a strong culture that does not recognize giving-in to foreign interests (Wallin & Åström, 2018). The US, on the other side, has been founded on a history of superiority and will do anything within their reach to protect their reputation. The position of the US in the attempts to win a deal has been strict, and that has been evidenced by the mixed messages that the US has been sending to China. The mixed reactions have been strategic in making China appear as the party on the wrong side of the battle. First, the US has requested China to stop their unfair trade tactics. Secondly, the US has accused China of taking advantage of a bilateral trade surplus. The arguments by the US have, however, not appeared to be taken seriously in Beijing, and China has continued to fall short of the expectations of the US. Historically, the US has been used in forcing countries to give in to their demands through sanctions, but the encounter with China has proved to be a different story. China is an established economy that may not be impacted by sanctions from a single economy. Therefore, the history of the two powers does not favor the attainment of a fair deal that will bring the trade war into a stop. The hope for a deal, however, exists with a series of meetings between Presidents Donald Trump and Xi Jinping.
Attempts Towards Reaching an Agreement
The hope for an agreement between the US and China still exists and could go a long way in saving the economy of the world. The frequent meetings between presidents Donald Trump and Xi Jinping show that the two nations are seeking a solution to the trade war that has proved disastrous to not only the economy of the two nations but also the world’s economy (Li, He, & Lin, 2018). Although the US has been blamed on several occasions for acting against the recommendations of several meetings, China has remained optimistic that a solution will soon be found. Besides, improvements are witnessed every time the two leaders meet, and the world hopes that one meeting will come out with a solution. For example, the US in October 2019 respondent to a previous meeting and lifted several tariffs on China products, with China responding similarly. Such developments are essential in moving the dialogues between the two countries towards an agreement that will see the end of the trade war.
In sum, the China-US trade war features a struggle for the removal of trade tariffs by the US as well as the use of fair-trading strategies by China, and the conflicts continue to shift to a new direction every day. The China-US trade was made worse by Trump’s introduction of trade tariffs to counter the growing concern over China’s unfair trading strategies. The introduction of tariffs has brought a negative contribution to the trade of products between the US and China. A deal between the US and China that would bring the temperatures down does not appear to be on the future plans of leaders of both nations. The hope for an agreement between the US and China still exists and could go a long way in saving the economy of the world.
References
Balistreri, E. J., & Hillberry, R. (2017). 21st century trade wars.
Lau, L. J. (2019). The China–US Trade War and Future Economic Relations. China and the World, 1-32.
Lee, B. (2019). Assessing Made in China 2025, the US-China Trade War and Ways Going Forward.
Li, C., He, C., & Lin, C. (2018). Economic Impacts of the Possible China–US Trade War. Emerging Markets Finance and Trade, 54(7), 1557-1577.
Mahadevan, R., & Nugroho, A. (2019). Can the Regional Comprehensive Economic Partnership minimise the harm from the United States–China trade war?. The World Economy.
Wallin, E., & Åström, E. (2018). ” Trade wars are good, and easy to win”: A study of Trump’s steel tariffs and international trade.
Xing, Y. (2018). China-US Trade War: a 21st Century Thucydides Trap? (No. 18-17). National Graduate Institute for Policy Studies.