Consequences of the Trade War Between The US and China
The potential trade war between the United States and China is a cause of worry for the global economy. Trade war at the cost of unemployed Americans. As a result of ongoing animosity between the two countries, President Trump has threatened to put tariffs exceeding 100% on imports from China.
This put Washington in turmoil and vowing to retaliate what they deem as overbearing moves from the US.
Global Trade Relations Between Two Superpowers
Last year, trade between these two nations reached approximately
585billion(A^£429billion) , with the US importing 585 billion (£429 billion), with the US importing
440 billion worth of goods from China while exporting only
145Â billion.Thisresultedinatradedeficitof145Â billion. This resulted in a trade deficit of
295 billion for the US in 2024, representing about 1% of its economy.
Trade Relations and Tariff Impacts
Although Trump maintains the skeletal dollar figure, I can still only go based off of ‘seeing is believing’ proof. The reign of American isolationist economic policies enforced during Trump’s presidency were watched over, protected and once again: expanded by current Potus Joe Biden. So while purportedly giving the illusion of swinging the deficit figure, actually reducing dollars spent on imports to the point they are projected to drop from 21% in 2016 to 13% a year prior to now. But as is the reality, U.S tariffs create an illusion of finally putting an end to chinese supremacy,
Trade Barriers and Goods From China
Surprisingly some chinese goods have been ‘blackmarker’ sent through southeast asia where the tariffs circumvent them.
For example, in 2018, solar panel manufacturers relocated their assembly to Malaysia and Vietnam after the 30% tariff was implemented. This move enabled these countries to shift their products tariff-free into the US.
Key Exports and Imports
In 2024, the US exports to China included soybeans, a vital staple for the Chinese pig farming industry, and pharmaceuticals alongside petroleum. In turn, China supplied large volumes of various electronics, toys, and batteries for electric vehicles. Specifically, Chinese smartphones claimed 9% of US imports which significantly impacts Apple. The company’s stock recently dropped by 20% because of the tariffs.
Future Implications of Increased Tariffs
The already implemented tariffs would increase the price of goods. A prospective rise to 100% would further increase the burden on US consumers and damage China if they retaliatory tariffs were imposed. Beyond the tariffs, both countries might use their manufacturing power to restrict each other’s access to important materials like rare earth metals.
Global economic ramifications
The US and China combined produce approximately 43% of the world’s economy. A total trade war could slow down growth or push the world into recession, which would have a negative impact in economies around the globe.
As the world’s largest manufacturer, China could run into problems as it could lead to a dumping situation where demand for Chinese goods would fall if it was unable to export goods to the US, which would also affect other markets in different countries.
Conclusion
If the trade war goes on, the entire globe could suffer due to the anticipated repercussions on international trade and economic equilibrium, as estimated by a large number of economists.
