US-China trade war has already begun after U.S. Commerce Department blacklisted Chinese technology companies. However, this may create some difficulties in the world’s financial markets.
The US-China trade war
Now, America and China are increasing pressure on each other and the war has gone beyond the tariffs. Previously, Donald Trump also warned that if the meeting does not have positive results, then he will proceed with new rounds of the tariff.
For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods. These payments are partially responsible for our great economic results. The 10% will go up to 25% on Friday. 325 Billions Dollars….
— Donald J. Trump (@realDonaldTrump) May 5, 2019
This month, Chinese President Xi Jinping and US president are expected to meet in Japan at the G20 summit. Furthermore, Trump added that trade war would end if it is negotiated before the summit.
— Deccan Chronicle (@DeccanChronicle) June 23, 2019
Since May 2019, the relationship between and America and China have declined. Also, Beijing has decided to give a response to Trump after blacklisting Huawei. Moreover, America is planning to extend tariffs to cover almost all Chinese imports.
But there is still hope. G20 may reduce the tension between both countries. However, if nothing goes according to the plans, then Trump may go further with a new round of tariffs.
— Sentifi Canada (@Sentifi_CA) June 20, 2019
What are the pressure points on both sides?
Rare earth metals
China exports around 80% of metals to America. There are high chances of cutting off supplies of the metals to the United States. Metal is the main ingredient used to build military equipment and electronics in America.
US trade group the National Retail Federation says that additional tariffs on China would cost US consumers an extra $18b per year, & hit the poorest hardest – #TradeWar by @SCMPNews https://t.co/vC3IlngbS4
— Post Click Media (@PostClick_Media) June 23, 2019
Harassing US companies or slowing visa approvals
China will draft a list that would include the names of foreign organizations and firms that are harming the Chinese companies. However, their idea could backfire because millions of Chinese citizens are dependent on foreign tech firms. Besides, it will not allow the famous restaurants and backs to do business in China such as Dedex and Starbucks.
— A Good Human (@tonykhouzam) June 23, 2019
Diplomatic recalcitrance and military posturing
Beijing won’t cooperate with American in international matters which includes Iran and North Korea.
— Hong Kong Free Press (@HongKongFP) June 23, 2019
Higher tariffs by the US
Trump will increase tariffs on all the Chinese imports which were being spared. They would raise more than $50 billion worth of Chinese imports on electronics, machinery and much more.
Quiet capital flight dents China's sway as $1.2tn 'disappears'
"The International Monetary Fund forecasts that China's current-account balance will turn negative in 2022, due to the effects of the U.S. trade war and other developments."https://t.co/HMRPplo6A6 #TradeWar
— H Ahmed (@Amexken) June 22, 2019
Justice department crackdown
The American Department of Justice will hunt down the Chinese hackers and spies for stealing trade secrets and technology of America.
They said that a #tradewar with #China would send inflation soaring and prices into space… but alas I was mocked for disagreeing now I can laugh as the data has proven me correct. pic.twitter.com/g7X59rdQET
— Edward 'Tj' Gerety III (@EdwardGeretyIII) June 22, 2019
America will also find out the Chinese companies that are helping North Korea for nuclear programs.
Check out The Geek Herald for more updates.