TRADE WAR BETWEEN US AND CHINA

MCR001C ECONOMIC ENVIRONMENT: TRIMESTER TWO, 2019

GROUP MEMBER:
• HOANG TU LAM 1490243
• ZHIYI YU 1454361
• KEERTHI THUMU 1490280
• SYED MAWAZ ALI SHIBLI 1475476
• SRINIVAS REDDY SIRRUP 1448683
 OUTLINE

• WHETHER TRUMP’S REASONS WERE ECONOMICALLY SOUND

• HOW CHINA RESPONDED
• HOW TRADE WAR AFFECT AUSTRALIA ECONOMY
• WHAT THE CURRENT STATE OF TRADE WAR
• ADVISING BOTH THE NATIONS TO SETTLE THE TRADE WAR
WHY DID TRUMP IMPOSE TARIFFS?
IS TRUMP’S REASONS ECONOMICALLY
SOUND?
IS TRUMP’S REASONS ECONOMICALLY
SOUND?
IS TRUMP’S REASONS ECONOMICALLY
SOUND?
IS TRUMP’S REASONS ECONOMICALLY
SOUND?
IS TRUMP’S REASONS ECONOMICALLY
SOUND?
HOW DID CHINA RESPOND
 THE RESPONSES OF THE EXPERTS
• READY TO ABSORB ECONOMIC PAIN.

• THE PURE SELF-DEFENSIVE.

• ONLY ABOUT A 0.5% HIT TO CHINESE GDP NEXT YEAR

• THE WORLD IS A BIG PLACE.

• A DIGNIFIED, A SENSTIVE APPROACH, A ONE OF MUTUAL RESPECT

 WHY IT MATTERS:
THERE’S NO WINNERS AFTER A ONE-YEAR OR LONGER TRADE WAR
WITHOUT RESOLUTION, BUT HERE ARE SOME OF THE PROBABLE
LOSERS:

• IN THE U.S.

• IN CHINA

• FOR BOTH
 WHAT'S NEXT: 
• IT IS FORECASTED THAT THERE WILL BE A NEW COLD WAR NEXT
YEAR BETWEEN THE U.S. AND CHINA, BUILT ON TECHNOLOGY AND
FOREIGN INFLUENCE.

• THERE IS AN OUTSIDE CHANCE THAT THE TRADE WAR BECOMES OUT

OF CONTROL, SUCH AS THE ACT OF "BUY AMERICAN" PURCHASING
RULES OR CHINA DECIDING TO BLOCK U.S. SHIPS IN PORT,
ACCORDING TO POSEN SAID.
 HOW US – CHINA TRADE WAR
AFFECT AUSTRALIA ECONOMY?
PRESENTATION BY
KEERTHI THUMU – 1490280
PROFESSOR- ANDY WEST
 KEY FEATURES
• IMPOSITION OF TARIFFS
OVER AN INCREASING OF
PRODUCTS
• COMMON TRADING
PARTNER
• CHINA IS AUSTRALIA’S
LARGEST EXPORT
MARKET
 IMPORTS &
EXPORTS
• BEEF, WINE
• NEGATIVE AFFECT ON
AGRICULTURAL
PRODUCTS AND LNG
• AUSTRALIA’S TOP
EXPORTS ARE IRON ORE,
COAL, LNG
• 22% GDP
 WINNERS

• FALLING AUSTRALIAN
DOLLAR
• STEEL & ALUMINUM
INDUSTRY
• WINE INDUSTRY
• MEAT INDUSTRY
• FARMERS
 LOSERS

• IRON ORE
• COAL PRODUCTS
 CURRENT STATE OF TRADE WAR

• THE TRADE WAR IS STILL GOING ON BETWEEN THE TWO

COUNTRIES.
• THE STOCK MARKET OF BOTH THE COUNTRIES ARE DEEPLY
SUFFERED FROM THE TRADE WAR.
• THE WEALTH OF THE RICHEST PERSONALITY IN USA AND
CHINA HAVE WITNESSED A SIGNIFICANTLY DECLINE OF $ 2
TRILLION.
CURRENT STATE OF TRADE WAR
• TRADE WAR HAS IMPACTED GLOBAL ECONOMY.
• IF THE TRADE WAR CONTINUES, RECESSION CAN HAPPEN
IN THE GLOBAL ECONOMY.
• BOTH THE COUNTRIES ARE IN TALKS TO SETTLE THE
ISSUE AS IT HAS MAJORLY INFLUENCED BOTH THE
COUNTRIES AND ITS IMPACT CAN BE SEEN.
 ADVICE

• THE IMPORT DUTY MUST BE ALLOCATED SUCH WAY THAT THE

TRADE BECOMES FLEXIBLE AND ALSO GENERATES REVENUE FOR
USA AND CHINA.
• IT WOULD BE SENSIBLE FOR BOTH THE COUNTRIES TO RESOLVE
THE ISSUES.
• US GOVERNMENT  SHOULD CONSIDER RELAXATIONS IN THE
POLICIES.
• US GOVERNMENT WILL BEAR MORE IF THE POLICIES ARE STILL
INTACT.
 CONCLUSION

• TRADE WAR HAS BEEN GOING ON SINCE  3 YEARS TILL NOW

• TRADE WAR IS PUSHING THE ECONOMIES TOWARDS RECESSION
• IT HAS  ECONOMY OF US AND CHINA ALONG WITH THE GLOBAL
ECONOMY.
• CONCLUSIVE STEPS SHOULD BE TAKEN TO SETTLE THE TRADE WAR
THANK YOU FOR YOUR ATTENTION