No one wins: on the US-China trade war(Hindu summary-9th July 2018)

www.iasinsights.in ; www.iasgyaan.com posts Hindu  summary about The consequences of US-China trade war

No one wins: on the US-China trade war

The Hindu

Context:

The official beginning of  “the biggest trade war in economic history” started between USA-China

How?

  • USA imposed tariff on Chinese products like solar panels and washing machines.
  • China imposed tariffs on USA products like Soyabean and automobiles.
  • Both countries imposed a tariff of 25% worth of $34 billion
  • Other trading partners like EU and others also imposed tariffs on USA goods.

Predictions:

  • USA Federal Bank in the month of June indicated that the measures by USA import tariffs will slow down Its growth.
  • It affects private investment as many companies are planning to with draw or halt the business plans.
  • China is already fighting an economic slowdown will be affected further.

Consequences:

  1. Political benefit to Trump as he is implementing “America First”
  2. Jobless situation in USA as China is restricting USA products
  3. Consumers need to pay high prices because of increased tariffs.
  4. This trade world will affect the whole global economy.
  5. It also isolates USA which already was done during signing of Trans-Pacific Partnership deal from which USA decided to withdraw.
  6. Countries for their export revenue and domestic producers will devaluate their currencies which is again another threat to world economy

Way forward:

Looking for nations development is good but not the cost of hurting or affecting the other countries. As we are living in a globalized world there is a need for speed brakes  regarding trade wars. As  we know it is a kind of predator policy where one day the trade war wil swallow everyone including the country initiated.

This site uses Akismet to reduce spam. Learn how your comment data is processed.