Achieving some sort of balance has always been mankind’s goal but it seems it borders next to impossible as the world had always been on some sort of unrest but civilized enough to let society function somehow normal. More often than not, it has always been powerful countries involved as has been the case in human history. The weaker ones get conquered by the stronger nations. Yet despite our modern advancements and most agreed-upon pacts an agreements among one another, conflict may still arise and trigger a modern-day trade war, in this case, between powerhouse nations, the US and China.
President Donald Trump has quite a flamboyant personality and his antics often scream he is up to no good but it is a different story now that he is the highest elected official in the land of Uncle Sam. His words and decisions not only affect American citizens but most likely the rest of the world too as world trade is a crucial concept that makes the world go round and if issues arise, it may have a drastic impact to the economy of various nations across the globe. We’d likely be reminded here that we import and export a lot of raw materials and goods from both countries that a power and economic rift between the two will certainly mean a certain doom to the majority of us.
There are so many reasons why this particular trade war is not good – and that the US warriors’ guns are pointing at quite the wrong targets – that it is easy to imagine many bad outcomes. Trump’s first foray, involving steel and aluminium, provided a marvellous illustration when it became clear from the outrage from Europe, Canada, Japan and South Korea that China was an inconsequential exporter of steel products to the US. Even Taiwan and Vietnam sell more steel to the US than China does – thanks to barriers long in place in the US against Chinese steel.
Many troubling insights arose from the Bloomberg discussion. There was agreement that there is legitimate concern about China’s efforts to cull intellectual property, and about a minefield of local regulations that raise practical barriers for foreign companies wanting to do profitable business inside the increasingly important Chinese domestic consumer market (China’s GDP grew by more than US$770 billion last year – more than the dollar value of economic growth in Europe and the US combined).
No matter where you are in the world (unless you live in an uninhabited island isolated from the rest of mankind), you do have a care as to whatever happens here as we trade globally and a dispute between these two nations can prove disastrous to the global economy. This impending trade war can have a big impact to businesses big and small especially that most materials used by different industries can only be found or grown in certain places and it’s common knowledge by now how many of these either come from the US or from China and how many industries can be found on these countries too.
In what he called the “first of many,” U.S. President Donald Trump announced on Thursday the U.S. will impose tariffs on $50 billion worth of Chinese imports. China says it does not want a trade war, but won’t shrink from one either.
“They’ve prepared well for this,” said Erlend Ek, research manager with Beijing-based China Policy consultancy. “They’ve done investigations into how to retaliate.”
China’s commerce ministry said in a statement Thursday that the country “will not sit idly to see its legitimate rights damaged and must take all necessary measures to resolutely defend its legitimate rights.” Those measures reportedly include tariffs on American agricultural products like soy and pork, steel pipe and ethanol.
The bottom line here is that when political leaders and nations are at a rift with each other and pursue policies that will obviously put a strain on global trade and relations, the consumers or the end-users are the ones who will suffer the most once currencies go down and prices of goods go spiraling up. Globalization has gifted us with so many things and made living in the 21st-century world easier and more convenient but when we face major conflicts involving trading and stuff, we can also expect major headaches. It’s too early to tell what will be the outcome of this issue as both countries don’t want to back down from each other, so let’s all wish everybody the best of luck as we weather this economic turmoil that for sure will leave most of us poorer and more stressed out too.