Abraham Lincoln said, “Nearly all men can stand adversity, but if you want to test a man’s character, give him power.” Power influences one’s perception & leads to people thinking more rationally and making sound decisions. Well, isn’t this desire to gain more power the principal reason behind the China-US trade war?
Since 1949, US-China relations have evolved from tense to complex, but there has always been a strain in the relation be it at the time of Bush’s Tiananmen event, the bombing of the Chinese embassy in Belgrade in May 1999, or Barack Obama’s Asia Pivot strategy and support for Japan in Senkaku islands dispute, it comes as no surprise that new strains have emerged once again.
In July 2018, China stopped purchasing US produced soybeans in retribution to US tariffs on Chinese imports, since then there has been a dangerous game of Sino-American tit-for-tat that has resulted in tariff on 1300 categories of Chinese import and an import tax of 25% on a $2.8 billion range of imports from the US. Tariff has historically been used to protect emerging industries and allow import substitution in industrialization but as a consequence of this intensifying competition between US and China, where China considers US, “the most dangerous imperialist power” and US is threatened by, “China’s rise as a threat to world order that is underpinned by American domination”, this tariff is being used to establish power, predominance of one’s own country over the other and is seen as a negotiation tactic in a trade war. Any further escalation in this struggle between US and China for economic supremacy will not only make them lose their global competitiveness besides it will also lead to currency wars, job losses, and higher unemployment, directly affecting the public.
Therefore, I think if no further harm is wanted to international firms and the investors, jobs and stock market are to be recovered, US and China should put an end to this bitter trade battle which has magnified to more than just a “trade war”.
By Muskan Yadav
Literary Sources- www.goodreads.com, en.wikipedia.org, www.china-briefing.com, en.wikipedia.org, www.bbc.com, ftalphaville.ft.com