Implications of US-China Trade War
Posted on : 13 Jan 2020Views: 57
- Sharp decline in bilateral trade:
- Higher prices for Chinese consumers, losses for US exporters and trade gains for other countries. Of the $35 billion Chinese export losses in the US market, about $ 21 billion (or 62%) was diverted to other countries, while the remainder of $14 billion was either lost or captured by the US producers.
- Higher prices for consumers:
- Tariffs imposed by the United States on China are economically hurting both countries and consumers in the US and China. The analysis shows that US tariffs caused a 25% export loss, inflicting a $35 billion blow to Chinese exports in the US market for tariffed goods in the first half of 2019
- Trade diversion effects:
- Increased imports from countries not directly involved in the trade war.
- The trade diversion effects of the US-China tariff war for the first half of 2019 at about $21 billion, implying that the amount of net trade losses corresponds to about $14 billion.
- These trade diversion effects have brought substantial benefits for Taiwan (province of China), Mexico, and the European Union.
- Trade diversion benefits to Korea, Canada and India were smaller but still substantial, ranging from $0.9 billion to $1.5 billion
- The US tariffs on China resulted in India gaining $755 million in additional exports to the US in the first half of 2019 by selling more chemicals ($243 million), metals and ore ($181 million), electrical machinery ($83 million) and various machinery ($68 million) as well as increased exports in areas such as agri-food, furniture, office machinery, precision instruments, textiles and apparel and transport equipment
Article Related Questions
What are the implications of ongoing US-China trade war?
1.Sharp decline in bilateral trade
2.Higher prices for consumers
3.Trade diversion effects
4.India is a gainer in this war
Choose the correct option
The 1857 Uprising was the culmination of the recurrent big and small local rebellions that occured in the preceding hundred years of British Rule. Elucidate (Answer in 150 words) - 2019 Mains
1.1 and 2 only
2.1, 2 and 3 only
3.1, 2, 3 and 4
4.3 and 4 only
Right Ans : 1, 2, 3 and 4