China- US Trade War could result in both countries being less reliant on each other

As the US-China trade continues, questions about the end goals of the trade war, what are the two countries are to benefit? The trade tension is creating a rift between the countries, as both are trying to diminish the reliance on each other.

The USA under President Donald Trump’s administration now considers China as its biggest threat. The Trump administration believes that China is involved in unfair trade practices.  The US believes that China wants take advantage of US foreign policy and the rules and regulations of the World Trade Organisation (WTO).

For China its main worry is its dependency on technology and the finished products it consumes that come from the USA. China’s worry has resulted in an initiative, Made in China 2025. Through this initiative china plans on becoming a leader in high-tech production and design lowering its need for foreign tech makers.

The United States and China need each other, the trade war is resulting in losses for both parties. Essentially the only thing the trade war is doing is dividing the world forcing lessor economic powers to choose between the America and China.

The divide has forced other countries to really look at which of the two superpowers is in their best interest to align with. As many multinational companies manufacture there products in China, the US tariffs coupled with rising labour costs in China, have driven many of these organization to consider moving production to countries with cheaper labour or back to their home country.

Source: bloomberg.com

 

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