With the nature of trade war, no country will benefit. The United States and China are aware of this and are trying to be less damaging.
However, as the world economy is increasingly open, with increasingly tightening economic ties, the consequences of an economic war between the United States and China become increasingly unpredictable.
The New York Times commented that President Trump understood that trade war would cause the parties to lose, but there would be fewer casualties in the game.
America can separate itself from the effects of commercial aggression more than most of its remaining competitors. As a large economy with strong internal resources, the United States can rely on domestic consumption for goods and services once the export opportunities are narrowed.
In the face of China, the US accepts that 545 US exports to the billion-dollar country, worth $ 34 billion, will be fined by China.
These commodities range from cars, aircraft to ... soybeans, one of America's main export agricultural products. China's response has officially come into force only hours after the United States imposed tariffs on goods from the country.
"There will be a bit of pain in the beginning, but my peasant friends, patriots, in the long run, will eventually have a better life," said Trump. to voters in Michigan in April, 1818.
The phrase demonstrates Trump's spirit with the outbreak of trade. He expects the American people to be ready for the immediate economic loss and expect to receive long-term benefits.
In 2017, according to US agency data, the country reported a trade deficit of more than $ 375 billion to China. Mr. Trump did not want that to happen. However, if the economic wars continue to escalate, the high probability of US taxpayers will not stop at 545.
Moreover, the United States is not only trading the war with China, but is also under pressure from other economies such as Canada, Mexico and Europe.
"In the case of a comprehensive trade war, it is likely that the United States will fall into recession in 2019, with unemployment doubling," Macquarie analysts said.
CHINA IS EXCELLENT AS A COUNTRY IS EXPORTER
In the new trade war, it can be seen that the United States has always acted first and that China is the response, reacting to every move of the United States.
China has repeatedly asserted that it would not be the start of a trade war. "The Chinese government's position has been repeatedly affirmed, and we will not initiate and will not impose duties on US goods if the US does not do the same," the spokesman said. Refused to comment further.
China obviously does not want trade wars with the United States as bilateral trade is benefiting China and it is accumulating many technological achievements from the United States in the trade.
A trade war with the United States will make Chinese businesses more difficult because the US is China's largest trading partner, accounting for 18.4% of its exports, according to data from Santander.
The opening of the US $ 34 billion worth of goods exported from China to the 25% tax group includes items such as machinery, electronics and high technology.
And with a response of $ 34 billion in exports from the United States, China will be prepared to receive the next blow from Mr. Trump as he had promised earlier.
"If China takes revenge, there will be another $ 400 billion worth of Chinese goods being taxed," the president said.
In theory, in a trade war, the importing country will suffer less damage than the exporting country. This partly explains why, as soon as the trade war broke out, the dollar strengthened slightly while the yuan fell.
The South China Daily also said that China has not bought enough goods from the US to take advantage of the war. Moreover, many Chinese goods subject to tax are hired by US firms right in China, so in many cases, China is making it hard for domestic businesses.
In the opposite direction, Chinese businesses do not create so much influence in the United States, so the advantage of trade war is still in the hands of the United States. According to many experts, this explains why China only responds, not to escalate.
However, as the manufacturing center of the world, Chinese enterprises are still very important in the supply chain of American businesses. As a result, China still has certain cards that can be used when trade wars worsen.
