The trade war between the US & China seems to dragging on and on. With President Donald Trump eager to prove to his Chinese counterpart that China can no longer get away with trade malpractices under his watchful eye, fears of a further escalation has rattled investors and hit stock market sentiments across the globe. The International Monetary Fund (IMF) as well has warned a full blown trade war would weaken the global economy. Trump began to complain about China’s trading practices since before he took office in 2016, and has come good on his promise after taking charge of world’s biggest economy.
So far the US has imposed tariffs on $ 250 billion worth of imports of Chinese goods. China in retaliation hit back with tariffs on $ 110 billion worth of US goods.
Donald Trump has decided to impose tariffs on imported Chinese goods to make locally produced US products cheaper than the imported Chinese goods and encourage consumers to buy American.
Finally, after much negotiation, a truce was reached in December of 2018 whereby both sides began to talk and not impose any further tariffs. However, recently that truce seems to be broken and President Donald Trump threatened to raise tariffs of $ 300 billion on China again if President Xi JinPing doesn’t meet with him and reach a deal at the upcoming G20 summit in Japan.
The Trump administration also accuses Huawei, a Chinese multinational technology company, of stealing trade secrets and conducting surveillance on behalf of Beijing and has banned American companies from dealing with Huawei citing national security concerns.
Another target of President Trump’s trade tariff threats is neighbouring country Mexico. After threatening to raise tariffs from 5% to 25% on a host of Mexican goods, Trump pulled back at the last minute when Mexico gave in to Trump’s demands and agreed to adopt a tougher stance on immigration.
The President, with a tight grip over his executive powers concerning trade matters, seems to be making other countries bend to America’s will. However, if unchecked, a mutiny by a collective of those that feel victimised by his high handed tactics, may not be all that far on the horizon.
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