The United States-China Trade War

(Economic Essay)

Two of the world’s giant have been engaging in a trade war. The current war on
trade between the United States and China has been escalating and there is no stopping
as of this time. One very important question is,” When did it start?”. China and the United
States have been engaged in a trade war through increasing tariffs and other measures
since 2018. The US Government imposed billions of dollars’ worth of tariffs on Chinese
goods, including solar panels, flat-screen televisions, aircraft parts, satellites, weapons,
and medical devices. In response to the offensive measures taken by the US, China
retaliated by also by imposing 25 percent tariffs on $34 billion worth of US goods,
including soybeans, automobiles, and lobsters. In fact, the exchange of tariffs between
the two reached up to 250 billion dollars and the numbers are growing.
Let’s dwell on the core issue. United States’ main objective is to sanction China by
making Chinese products more expensive for American consumers. It will result in China
losing its sales and revenue. China did the same thing to the US, hoping the latter will
open its eyes and might consider compromising and meeting halfway to solve this
situation.
The list of global effects of the trade war has been slowly piling up. There were
positive and negative effect. Let’s discuss the negative results, first already showing up
in the economy as a result of the tariffs, companies were planning on laying off their
employees resulting in the increase of unemployment rates. It will mostly affect those
companies who are partly owned by other countries, there is a possibility of collateral
damages. Second, we will have fewer options when it comes to technology imports. A
very visible example is what happened to one of the most top-performing telecom
companies Huawei, it was blacklisted by the US. The latter prohibited American
companies from supplying an android operating system and US corporations including
chip-makers Intel, Qualcomm, Xilinx, and Broadcom have told their employees they will
not supply Huawei until further approval from the US Government. Lastly, It also triggers
inflation when tariffs increase the prices of imports.
Amidst all the negative aspects, there is also a brighter side. When a nation
exercises its trade protectionism, It creates more jobs for their constituents. These tariffs
may give a bigger advantage to domestic producers of that product. Their prices would
1. "President Trump Slaps Tariffs on Solar Panels in Major Blow to Renewable
Energy"(January 23, 2018). Retrieved from https://time.com/5113472/donald-
tru2018.
2. ^ "Trump's solar tariffs could put the brakes on rapid job growth in renewable
energy". (January 23,2018.)Retrieved from
https://www.cnbc.com/2018/01/23/trumps-solar-tariffs-could-slow-down-rapid-
renewable-job-growth.html
3. “A quick guide to the US-China trade war.” May 14,2019,Retrieved from
https://www.bbc.com/news/business-45899310
4. Zeeshan Aleem “The US-China trade war, explained in under 500 words”( Jul 6,
2018). Retrieved from https://www.vox.com/world/2018/7/6/17542482/china-
trump-trade-war-tariffs

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be lower by comparison. As a result, local customers will start to patronize their local
products. As their businesses grow, they would add jobs. Also, third world countries, like
the Philippines will have the chance to supply domestic products to the US. Aside from
the product supply, they may also outsource the workforce for their manufacturing firms.
Hence, the impacts of the rising tension between the two of the largest economy
in the world will not just greatly affect them but also the countries connected to them. The
negative effects definitely outweigh the positive. In the near future, it will increase the
vulnerability of Asian exporters and business partners. As of the moment, the exchange
of the threats might put down the global economy and more serious consequences are
coming. The destructive effects may be difficult to repair in the long run.

1. "President Trump Slaps Tariffs on Solar Panels in Major Blow to Renewable

Energy"(January 23, 2018). Retrieved from https://time.com/5113472/donald-
tru2018.
2. ^ "Trump's solar tariffs could put the brakes on rapid job growth in renewable
energy". (January 23,2018.)Retrieved from
https://www.cnbc.com/2018/01/23/trumps-solar-tariffs-could-slow-down-rapid-
renewable-job-growth.html
3. “A quick guide to the US-China trade war.” May 14,2019,Retrieved from
https://www.bbc.com/news/business-45899310
4. Zeeshan Aleem “The US-China trade war, explained in under 500 words”( Jul 6,
2018). Retrieved from https://www.vox.com/world/2018/7/6/17542482/china-
trump-trade-war-tariffs

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