10.04.2018
The 25 percent tariffs imposed recently by the United States on imports of goods from China have already caused countermeasures from Beijing, which in response also imposed its duties on 128 types of American goods. At the same time, China has repeatedly publicly expressed the expediency of refraining from protectionist measures in bilateral trade, but Washington still took this step.
If we recall, D. Trump spoke about the introduction of duties on imports of Chinese goods from the first days of his political campaign. But, putting such a major topic on the agenda of his political program, he still could not help but realize that China and the United States have long been very important trade and economic partners for each other.
Emotional and politicized measures
Recently, the United States, which previously promoted the ideas of globalization, on the contrary, promotes strict trade protectionism on a global scale. At the heart of this new ambiguous policy is the election program of the American President D. Trump “America First!” (America First!).
The current US president won the elections in 2016 precisely on the wave of support for the American working class, which would largely receive economic preferences from creating new jobs by returning production to the United States and from raising tariffs on non-American goods. The slogan “Buy American” sounds beautiful, but its implementation in the realities of the global world is very difficult.
Apparently, this decision of the US leader is aimed at an internal audience – D. Trump wants to demonstrate to his electorate the ability to fulfill his promises in terms of supporting the American market and industry. On the other hand, with such unilateral measures, the White House is trying to encourage the return of production by American companies back to the United States.
Perhaps such a decision by the US leader will bring him a certain tactical victory, but in the long-term scenario, on the contrary, it may harm him somewhat. In 2017, the volume of bilateral trade between the United States and China exceeded 580 billion US dollars. Any reduction in this volume will inevitably affect producers and buyers in both countries.
In addition, it is still unknown how much American companies developing production in China will be ready to return their factories to American territory. Business does not like to be put under pressure. According to some estimates, it is quite possible to expect some pressure on D. Trump from the American industrial lobby and TNCs that have their business in China.
There is another dimension to this question. At the present stage, the United States and China are the largest economies in the world. At the same time, according to all forecasts, in 15-20 years, China has prospects of becoming the “number one”global economy. This is also recognized by American experts.
Therefore, perhaps through the withdrawal of American production from the PRC, Washington is thereby trying to somewhat weaken the potential of its main economic competitor. Question – how relevant is this in modern conditions, when countries are interdependent and when China has already significantly strengthened in economic and technological terms?
Most likely, this approach of D. Trump in terms of “economic nationalism” is only emotional and politicized measures, as already mentioned, aimed at his electorate in the United States, which may feel the impact of the tariff US-Chinese confrontation… In this case, it is impossible not to take into account the social factor.
Given the large volume of imports of Chinese goods to the United States, these duties may affect the ordinary American consumer, who will ultimately pay for the increase in the cost of goods. According to some preliminary estimates, this amount may exceed $ 800 per American family.
Healthy competition in trade is normal, but the main thing in this case is not to allow the division of the world economy according to an ideological principle, then the market itself will resolve many imbalances and difficulties.
Turn a crisis into an opportunity
But any rash trade wars between China and the United States can greatly affect the stable development of the global economy. When we are talking about two world giants, which account for more than 40% of the global economy and which largely determine its development – it is important to approach any conflicts very calmly and strive to find a compromise through negotiations.
It is important that, despite the retaliatory measures against American goods, China demonstrates a confident, calm approach and, despite Washington’s pressure, is still ready for negotiations. This is very pragmatic, and it is important to continue this line, because today the development of its neighbors participating in the “One Belt and One Road”initiative largely depends on the level of development of the People’s Republic of China.
On the other hand, in the event of a change in the terms of trade in the United States, China today has the opportunity to redirect its goods to the growing Eurasian markets (the European Union, the Middle East, South Asia, etc.). A possible crisis in trade can turn into new opportunities, the most important thing is to see and implement them.
The developed transport infrastructure, created over several years within the framework of the” One Belt and One Road”, facilitates this opportunity. For the world economy, this may mean a large-scale redistribution of global trade flows and the emergence of new formats of cooperation between countries.
In principle, there is also a conceptual basis for this. Over the years of the implementation of the “One Belt and One Road” initiative, modern China has shown the world the possibilities of developing globalization not according to the Western standard. The Chinese approach shows the possibility of collective, joint development. China demonstrates by its example the new future of the entire Asian region and, due to the powerful dynamics of growth, creates opportunities for all its neighbors.
In particular, Central Asia has now once again become a strategic transit and transport hub of Eurasia through the implementation of the Silk Road Economic Belt Initiative. Within the framework of such cooperation, for example, Kazakhstan has opportunities for export to East Asian countries through the port of Lianyungang, new prospects for industrial development and growth of non-resource sectors of the economy have opened up. And there are many such examples.
Therefore, if the American direction of trade continues to experience problems of politicized tariff regulation, then it is probably time for Beijing to take a closer look at the modern Silk Road and proceed to the next qualitative stage of its development. There are new opportunities for growth in the growing Eurasia today, and the first 5 years of the implementation of the” One Belt and One Road ” have shown this perfectly.
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