By Christopher Whalen May 17, 2019
President Donald Trump and Chinese President Xi Jinping are caught in a growing dispute over trade and, more broadly, the significant differences between their two very different political economies. Tough as it is to predict the future, there are some signs as to who will be the winners and losers.
Trump calls the dispute “a little squabble,” and in economic terms the threat of conflict with China does seem minimal. The retaliatory tariffs China unveiled last week, for example, won’t significantly slow the American economy, cutting economic growth by about a tenth of a percentage point next year if the spat isn’t ended, according to Oxford Economics and Moody’s Analytics.
Indeed, the biggest cost may be imposed on investors, who for years have inflated the economic potential of communist China’s state-directed economy. Major public companies in the United States, including Apple, Caterpillar, and Boeing, are among some of the leading exporters to China. Yet exports to China accounted for just 7.2 percent of overall American exports in 2018. According to the U.S. Trade Representative, the top export categories that year were: aircraft ($18 billion), machinery ($14 billion), electrical machinery ($13 billion), optical and medical instruments ($9.8 billion), and vehicles ($9.4 billion).............To Read More.....
President Donald Trump and Chinese President Xi Jinping are caught in a growing dispute over trade and, more broadly, the significant differences between their two very different political economies. Tough as it is to predict the future, there are some signs as to who will be the winners and losers.
Trump calls the dispute “a little squabble,” and in economic terms the threat of conflict with China does seem minimal. The retaliatory tariffs China unveiled last week, for example, won’t significantly slow the American economy, cutting economic growth by about a tenth of a percentage point next year if the spat isn’t ended, according to Oxford Economics and Moody’s Analytics.
Indeed, the biggest cost may be imposed on investors, who for years have inflated the economic potential of communist China’s state-directed economy. Major public companies in the United States, including Apple, Caterpillar, and Boeing, are among some of the leading exporters to China. Yet exports to China accounted for just 7.2 percent of overall American exports in 2018. According to the U.S. Trade Representative, the top export categories that year were: aircraft ($18 billion), machinery ($14 billion), electrical machinery ($13 billion), optical and medical instruments ($9.8 billion), and vehicles ($9.4 billion).............To Read More.....
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