US-China-EU trade war

Author Topic: US-China-EU trade war  (Read 22 times)

Offline Anhar Sharif

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US-China-EU trade war
« on: February 19, 2020, 08:50:00 AM »
Currently, some largest economies in the world are passing tough times with experiencing unfriendly trade terms imposed by Trump administration. Donald Trump gradually began to impose trade related terms and conditions on its competitors hours after being US president. Why Trump Administration is showing unfriendly attitude towards different leading economies for long is completely undiscovered to me. The concerned administration’s trade decision seems to be unwise because the decision is hampering world economy growth pace. US- based International Monetary Fund ( IMF) chief economist- Gita Gopinath has in the meantime projected that global gross domestic product ( GDP) would be reduced by 0.8 per cent due to tariff impose on China by Donald Trump. As a result of much discussed trade war between US and China, the world’s second largest economy is facing growth troubles with only 6 per cent that is lowest in 30 years. The another famed economies including euro zones are also being victimized for US unwise decision to impose tariff. US president Donald Trump generally known as business tycoon is also going to damage growth rate of EU by imposing tariff on goods ranging from French wine to Italian cheese, scotch whisky and Spanish olives. EU is expected to seek proper judgment from World Trade organization (WTO) shortly regarding resolving ongoing disputes. Italy- Euro zone’s third largest economy is already facing the impact of US-EU trade war. Italy’s economy remains stagnant with no trade activities for months. The trade dispute between the United States and China has roiled financial markets and has dragged global growth to its slowest pace since 2008-2009 financial crises. Global trade growth reached just 1 per cent in the first half of 2019, the weakest level since 2012. After expanding by 3.6 per cent in 2018 , the IMF now projects global trade volume will increase just 1.1 per cent in 2019. Trade growth was expected to rebound to 3.2 per cent in 2020- IMF high official elaborated. With viewing this alarming projection, the need for reforming some trade policies needs to be taken in hand. China is deeply thinking alternative ways how to overcome the ever first tough situation. I do believe Beijing would reform its policy with intellectual ways that helps to be grown very fast in the days to come. It is worrying that there comes no green signal from Trump Administration for ending the trade war. Donald Trump’s hasty move for resolving tariff issue with EU and China should be launched right now without delay as world economy is going to be clouded very soon. World economy is set to lose its tempo. As reported in newspapers, global economy faces troubles shortly since many leading economies in the world have recently been locked into conflict one another. Persisting trade war between USA and China continues to widen following tariff hike imposed by US president Donald Trump. There needs to be mentioned here that Washington and Beijing talked about the issue to be resolved many times but Donald Trump’s green signal to resolve the burning issue had been completely absent. The world’s another emerging economy- India never wants China’s intervention in any affairs. China still now did not push its products in Indian market to a great extent. Even though, China did not gain the ability to set up business plants in India as India thinks China as a big competitor in trading arena. What should be noted here that Bangladesh and India never accepts any business proposal sent from the country- Pakistan? Again, Pakistan maintains close ties with China for trade interest. This is universal truth is that trade war among world leaders is not new at all. Every leader has an intention to win the race whenever trade related talks are held. For the economic interest of the country, the visiting countries’ heads want trade favors always. One of trade terms ` tariff’ has currently become the key issue behind the trade war between the United States and China- the major world’s two vibrant economies. China with high growth economy is trying best to end the conflict but Trump administration is very stick not to bow down before Beijing in respect of tariff issue that lasted for long 15 months. China’s GDP growth recorded 30-year low since US president Donald Trump did not want to relax the imposed tariff affecting business more than expectations. Currently, China’s trading partners and investors are closely watching the health of world’s second largest economy as the ongoing trade war with United States fuels fears about a global recession. It is worrying that in the days to come, the global economy is set to face a significant decline in gross domestic product. Against the backdrop of this downward trend of growth is only ongoing trade war among many countries. If this significant issue remains unresolved, the global economy might have fallen in great troubles with real spillover effects for emerging markets. To conclude, US president Donald Trump must relax tariff imposed to EU and China. World Influential president Mr Trump had better talk with WTO high ups ahead of imposing levies on China and EU. For the interest of keeping global economic momentum, there needs to be taken hasty steps to reform trade rules. WTO has a role to talk with Trump administration regarding withdrawing the imposed tariff. I want to say that Trump has no right to paralyze world economic image that was earned through efforts given from world prominent leaders and economists. — Md Mazadul Hoque is an economic analyst and currently serving at Social Islami Bank Ltd. Member- Bangladesh Economic association (BEA).
Md Anhar Sharif Mollah

Assistant Professor of Finance

Department of Business Administration

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Daffodil International University

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