Tuesday, September 26, 2023

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China’s trade war with US resulted in loss of USD 550 billion: Report

Beijing [China]: Amid an economic slowdown, China’s four-year ‘trade war’ with the US has resulted in a total loss of USD 550 billion in import tariffs, the majority of which are aimed at Beijing, a media report said on Saturday.

The trade war, accompanied by a slowdown in China’s economy and the impact of the COVID-19 pandemic, has resulted in the World Bank predicting a significant slowdown in the global economy as well as a lower prediction for the economic growth in the United States and China, reported The Hong Kong Post.

“China’s trade policy with respect to the United States has been more reactionary than anything else, responding to, rather than initiating, changes on a tit-for-tat basis,” said Jayant Menon, a visiting senior scholar of the ISEAS-Yusof Ishak Institute’s Regional Economic Studies Programme in Singapore.

China has targetted imports from even other countries that it sees as operating in the US’s sphere of influence. Chinese exporters have stopped importing Australian coal, sugar, barley, lobsters, wine, copper, and log lumber since 2020.

Last year, Japan filed a formal complaint with the World Trade Organisation over anti-dumping charges imposed by China on the stainless steel imports since July 2019, a move which Beijing termed as “regretful”, the report said.

However, while China restricted its trade imports from these countries, its exports to Australia, Japan, and the US in the following year were worth USD 648.7 billion, the report said, adding that the large exports were mostly due to the impact of Regional Comprehensive Economic Partnership (RCEP), the world’s largest free-trade agreement which China had entered into the previous year.

China would attempt to manipulate free trade deals and the international markets in order to offset the impact of the trade war and the economic slowdown, added the report.

China would regulate credit availability in international commerce, assist businesses in overcoming challenges and make greater use of free-trade agreements that have been negotiated or signed in order to “integrate and progress”, the report said citing Li Xingqian, the Director-General of International Trade in China’s Ministry of Commerce.

However, China despite its ambitions to create a new order in global trade will remain dependent on the US for innovation because much of its Information Technology (IT) sector currently is focused on manufacturing instead of innovation, the report said citing Alan Chong, an assistant professor at Singapore’s S. Rajaratnam School of International Studies. 

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