By CGTN’s Martina Fuchs
In a war, there is no winner. The same goes for a China-US trade war which has been looming. The possibilities of economic friction between the US and China are too large to be wished away.
US President Donald Trump declared China the "grand champions" of currency manipulation in February. During his presidential campaign, Trump frequently accused China of keeping its currency artificially low against the dollar to make Chinese exports cheaper, "stealing" American manufacturing jobs.
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Chief economist at China International Capital Corporation (CICC), Dr. Liang Hong worries about the risks of a lose-lose type of trade war rising.
"I think the risks of a more lose-lose type of trade war between China and the US, that risk has risen after the election. Both sides, particularly the US side, when they look exactly at what can be done, I think people will eventually get more pragmatic," Liang said.
Trump has criticized China's trade practices and threatened to impose punitive tariffs, as much as 45 percent, on Chinese imports. However, under the threat, more Chinese goods have been exported to the US market over the past couple of months.
Andrew Polk, director of China research at Medley Global Advisors, thinks the potential tariffs cannot stop the increasing demand from the US. "The demand from the US has been improving and so you'd like to continue seeing that global trade is improving especially trade between the US and China.”
CFP Photo
But Polk also expects the US to take some actions toward China. “Of course there is the risk that the Trump side will take some action towards China. What I'm expecting is some selective tariffs. I think an interesting space to watch is aluminum," he explained.
An American Chamber of Commerce report found in January that over 60 percent of members had little or no confidence that the Chinese government is committed to opening markets further in the next three years.
For more on business relations between the countries and the impact of Trump's policies on US companies in China, CGTN’s Martina Fuchs spoke to William Zarit, chairman of the American Chamber of Commerce in China.
CGTN’s interview with William Zarit
The Chinese government has said it is willing to work with the new US administration to promote the healthy development of commercial ties. Premier Li Keqiang said earlier this year that a trade war would benefit nobody, and that Beijing has a "stable, optimistic outlook" on trade with the US.
