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1. The U.S.-China Trade War: Is There an End in Sight?

Author:
Simon Lester and Huan Zhu
Publication Date:
01-2020
Content Type:
Journal Article
Journal:
The Cato Journal
Institution:
The Cato Institute
Abstract:
Donald Trump was a trade “hawk” long before he became president. In the late 1980s, he went on the Oprah Winfrey show and complained about Japan “beating the hell out of this country” on trade (Real Clear Politics 2019). As president, he has continued with the same rhetoric, using it against a wide range of U.S. trading partners, and he has followed it up with action (often in the form of tariffs). While many countries have found themselves threatened by Trump’s aggressive trade policy, his main focus has been China. As a result, the United States and China have been engaged in an escalating tariff, trade, and national security conflict since July 2018, when the first set of U.S. tariffs on China went into effect and China retaliated with tariffs of its own. In this article, we explore the U.S.-China economic conflict, from its origins to the trade war as it stands today. We then offer our thoughts on where this conflict is heading and when it might end.
Topic:
Economics, International Trade and Finance, Tariffs, Trade Wars, and Donald Trump
Political Geography:
China, Asia, North America, and United States of America

2. Has U.S. Government Angst over the China Danger Diminished?

Author:
Robert Sutter
Publication Date:
01-2020
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
The so-called “truce” in the trade war with the signing of the phase one U.S.-China trade agreement on January 15 comes amid indicators that the intense U.S. government consensus pushback against a wide range of perceived challenges posed by China may be subsiding.
Topic:
Government, Bilateral Relations, Economy, and Trade Wars
Political Geography:
China, Asia, North America, and United States of America

3. Europe in the Age of Uncertainties

Author:
Mikael Barfod
Publication Date:
05-2020
Content Type:
Commentary and Analysis
Institution:
American Diplomacy
Abstract:
Donald Trump has regularly chipped away at multilateralism during his three years in power: climate change, trade wars, immigration, withdrawal from international conflicts, ambiguity about defence alliances, and even suspension of the US budget for the World Health Organization, to mention a few. EU policy, on the other hand, has always supported the UN and the multilateral approach. A traditionally open and liberal EU has a clear self-interest in preserving multilateralism. Could the EU (as I have previously argued[1]) still take the lead in forming effective international alliances to reactivate and possibly even reform multilateral structures? How can Europe take “its destiny into its own hands” as Angela Merkel suggested recently? Well said, but she is retiring in a year and a half. And meanwhile, what has the coronavirus done to Europe’s destiny? Let’s look at today’s main challenges and opportunities.
Topic:
Climate Change, Immigration, Multilateralism, Trade Wars, and Donald Trump
Political Geography:
Europe and United States of America

4. China's Economic Choices

Author:
David Orsmond
Publication Date:
12-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
China’s economic growth has fallen to its slowest rate since 1990, and this deceleration looks set to continue unless China implements the kinds of deep reforms behind the successful economic transitions of Japan and Korea. China’s economic growth has fallen to its slowest rate since 1990, and this deceleration looks set to continue. Key factors include weakening demographics, inefficient investment, maturing export markets and declining productivity growth rather than the current trade dispute with the United States. To reverse that trend, China will need a wide-ranging policy approach that mimics the policies implemented by Japan and Korea at a similar economic stage. While there are considerable political and economic obstacles to such reforms, if it manages to continue its rapid catch-up to advanced economy incomes the potential returns for both China and the world are significant.
Topic:
Reform, Economy, Economic growth, Trade Wars, and Trade
Political Geography:
China, Asia, Australia, and United States of America

5. Averting a Global Calamity? Trump and Xi at the G20

Author:
John Edwards
Publication Date:
06-2019
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
The outlines of a trade deal between the United States and China are there. But without a return to the negotiating table, the dispute could rapidly escalate, magnifying the damage to world growth. With the Osaka G20 meeting looming, Chinese analysts and policymakers visited in Beijing are pessimistic about the prospects for a trade deal with the United States. If they are right, global financial markets are in for a much wilder shock than anything yet seen in this quarrel. Yet much of a deal has already been agreed, while the consequences of not reaching a deal have become increasingly dire.
Topic:
International Relations, International Trade and Finance, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

6. Trump’s Trade Wars: A New World Order?

Author:
James M Dorsey
Publication Date:
11-2019
Content Type:
Special Report
Institution:
The Begin-Sadat Centre for Strategic Studies (BESA)
Abstract:
President Donald Trump’s declared economic protectionism has taken the US’s international relations with several foes and allies into uncharted territory. His open-ended trade wars with several nations have triggered criticism among conservatives and liberals alike in the US. He has justified his actions by arguing for a downturn of America’s trade deficit, but the American people don’t seem to be on board with his logic. A recent Harvard CAPS/Harris Poll survey shows 63% of registered voters believe tariffs imposed on Chinese products ultimately hurt the US more than China, while 74% said American consumers are shouldering most of the burden of those tariffs. The political network funded in part by billionaire libertarian Charles Koch has contested Trump’s approach toward China and is trying to shape an alternative strategy for 2020, the year of the US presidential election. One Koch senior official has acknowledged, “It doesn’t penetrate with the people that are willing to go along with the argument that you have to punish China.” There is now a pursuit of a “two steps back strategy,” which will involve putting together a team of almost 100 business leaders to call on the Trump administration and lawmakers to end the trade war with China. This paper examines the ramifications of President Trump’s policy of economic sanctions and tariffs vis-à-vis several nations and international groupings. It also looks at China’s counter-strategy and considers whether Middle Eastern countries like Saudi Arabia will be caught in the web of the current trade wars.
Topic:
International Relations, Economy, Trade Wars, Trade, and Donald Trump
Political Geography:
North America and United States of America

7. Did Trump's Trade War Impact the 2018 Election?

Author:
Emily Blanchard, Chad P. Bown, and Davin Chor
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
Republican candidates lost support in the 2018 congressional election in counties more exposed to trade retaliation but saw no commensurate electoral gains from US tariff protection. The electoral losses were driven by retaliatory tariffs on agricultural products and were only partially mitigated by the US agricultural subsidies announced in summer 2018. Republicans also fared worse in counties that had seen recent gains in health insurance coverage, affirming the importance of health care as an election issue. A counterfactual calculation suggests that the trade war and health care can account for five and eight of Republicans' lost House seats, respectively.
Topic:
Politics, Elections, Trade Wars, Trade, and Donald Trump
Political Geography:
North America and United States of America

8. US-China Trade War: Both Countries Lose, World Markets Adjust, Others Gain

Author:
Sherman Robinson and Karen Thierfelder
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
Peterson Institute for International Economics
Abstract:
The terms of the US-China trade war change often, but the tariff escalations have inflicted documented economic damage on both countries. Expanding the conflict will only increase the damage and reverberate across the world economy. This Policy Brief uses a computable general equilibrium model of the global economy to analyze three scenarios that could unfold in coming months. The first scenario is the current situation (as of June 2019). Two additional scenarios assume implementation of proposed US tariffs and Chinese responses. The models project the situation after the two countries and the rest of the world adjust across a time horizon of three to five years. For the United States, higher tariffs raise prices and reduce demand for consumers and producers. For China, the tariffs raise the prices of consumer goods but have less direct impact on producers, because the Chinese have exempted some intermediate inputs. US exports and imports decline under all three scenarios. But China can successfully divert its exports away from the United States and escape maximum economic damage.
Topic:
Economics, Global Markets, Finance, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America

9. EU Trade Policy amid the China-US Clash: Caught in the Cross-Fire?

Author:
Ana González and Nicolas Véron
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
China's rapid rise and unique economic system and the increasingly aggressive and disruptive US trade policy are posing an unprecedented threat to the global rules-based trading and economic system. The European Union has critical interests at stake in the current escalation, even as it has so far been comparatively spared from US trade policy belligerence and China's reactions. In this context, the European Union should adopt an independent and proactive stance, building on recent efforts and going beyond them. The European Union, even more than the United States or China, has a strategic interest in the preservation of the global rules-based order embodied by the World Trade Organization (WTO). It must play a leading role in steering WTO reform and modernization, working closely with broadly aligned third countries such as Japan and other players. It should expand its outreach beyond its immediate negotiating counterparts in both the United States and China, and leading European officials at both the EU and member state levels should work at better understanding China. While strengthening its domestic policy instruments to address new challenges, such as the screening of foreign direct investment for security purposes, the European Union must also resist its own temptations of protectionism and economic nationalism. In support of these objectives, the European Union should prepare itself for difficult decisions, which may involve revising some of its current red lines in international trade negotiations. Conversely, the European Union should stand firm on principles such as refusing one-sided agreements and rejecting abusive recourse to national security arguments in trade policies. The European Parliament, in working with the European Council and the European Commission, will have a critical role to play in steering the European Union through these challenging times.
Topic:
Bilateral Relations, Economy, Trade Wars, and Trade Policy
Political Geography:
China, Asia, North America, United States of America, and European Union

10. The 2018 US-China Trade Conflict after 40 Years of Special Protection

Author:
Chad P. Bown
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Peterson Institute for International Economics
Abstract:
In 2018, the United States suddenly increased tariffs on nearly 50 percent of its imports from China. China immediately retaliated with tariffs on more than 70 percent of imports from the United States. This paper assesses what happened in 2018 and attempts to explain why. It first constructs a new measure of special tariff protection to put the sheer scope and coverage of the 2018 actions into historical context. It then uses the lens provided by the 2018 special tariffs to explain the key sources of economic and policy friction between the two countries. This includes whether China’s state-owned enterprises and industrial subsidies, as well as China’s development strategy and system of forcibly acquiring foreign technology, were imposing increasingly large costs on trading partners. Finally, it also examines whether the US strategy to provoke a crisis—which may result in a severely weakened World Trade Organization—was deliberate and out of frustration with the institution itself.
Topic:
Economics, International Trade and Finance, World Trade Organization, Bilateral Relations, Trade Wars, Donald Trump, and Imports
Political Geography:
China, Asia, North America, and United States of America