US-China trade war gets to the peak
It’s been more than a year that two major economies in the world, US and China are fighting a trade war among themselves. It all started back on 22 March 2018 when US President Mr. Trump asked USTR (United States trade representative) to apply the tariff on Chinese goods. Chinese imports worth US$ 50 to 60 billion which listed aircraft parts, batteries, flat-panel televisions, medical devices, satellites, and various weapons were charged. Trump stated that it was a response to the Chinese unfair trade practices over the years.
China couldn’t remain silent over this deed of the US. Ministry of Commerce, China reacted by imposing tariffs on 128 American imported products such as aluminum, airplanes, cars, pork, and soybeans as well as fruit, nuts, and steel piping.
Mr. Trump kept saying that there is no trade war between the US and China. To reduce all this deficit with the US, Chinese economical consultants of the President and General Secretary Xi Jingping, visited Washington to have a talk. By agreeing to increase the purchase of American goods, Chinese officials stated that we are keeping the US-China trade war on hold while White House officials said: “there is no such US-China trade war, it was just a clear and simple economical dispute.”
Obviously, that was not the happy ending of this US-China trade war and the so-called clear and simple dispute. On May,18 The White House announced a 25% increase in the tariff on products worth $50 billion which are loaded with industrially significant technology. “If We didn’t increase tariff and control investments as well as export, China will acquire our Technology”, white house officials stated. China made an announcement that they will discontinue talks with Washington as a response.
US-China trade war – Mr. Trump
Mr. Trump again announced that they will impose a 25% tariff on another Chinese export worth $50 billion. China accused the US of starting a US-China trade war and threatened the US that they will also respond with similar tariffs on US imports. Mr. Trump couldn’t remain silent and imposed a 10% tariff on Chinese exports worth $200 billion.
US-China trade war between two full power economies plotted fear in import and export business within many countries that this can lead to affect the supply chain around the globe. But nothing changed, in August 2018, the US declared the list of Chinese goods worth $16 billion, on which they imposed a 25% tariff. In response to this, China also imposed a 25% tariff on American goods worth $16 billion. On 14 August 18, China knocked the doors of the World Trade Organization (WTO) for help and filed a complaint against the US for imposing a tariff on Solar panels and crashing the international market for solar panels. China stated that this harms China’s legitimate trade interests.
All of this started back then, reached a higher level when US president Mr. Trump announced that the US will increase 25% tariff rather than 10% on Chinese goods costing $200 billion. Later on, President Trump restricted the export of information technology in communication to foreign adversaries, although no particular company or nation was stated Mr. Trump’s direct moto was to give an end to Chinese espionage. While addressing at the G20 Osaka summit, President Trump said that the successful negotiations are done between respected nations, and there will be no rise in tariffs for the time being. Trump then stated that the white house is allowing the trade of technologies with Huawei, however, Huawei will still remain blacklisted.
On 1st august of 2019, US President Trump tweeted that the US will charge an additional 10% tariff on remaining Chinese goods worth $300 billion. This became fuel to the US-China trade war to fire up again. In reaction to this, China dropped Yuan, the Chinese currency as lowest as ever in a decade. This all grabbed the attention of the entire world again on Monday the 5th of August,19. The US accused China as a currency manipulator. China let the drop of the Yuan knock the US dollar sharply lower and increase gold prices to six years higher.
Mr. Trump tweeted that,
“China dropped the price of their currency to an almost historic low. It’s called ‘currency manipulation.’ Are you listening to Federal Reserve? This is a major violation which will greatly weaken China overtime!”.
The US-China trade war made an impact on US stocks to get plunged. Due to this downfall on Wall Street, 500 wealthiest people lost 2.1% of their collective net worth. Officials from Beijing replied to Washington that they accused of manipulating currency on China would cause chaos in the market and damage international financial damage.
No war is profitable for any nation, whether it’s been fought for trade or currency as well as land. All we can do now is to keep an eye on this US-China trade war and hope to get it over.