Washington:
The United States and China have officially initiated a commercial dispute that could be a short duration or prolonged and painful trade war. The conflict began when the United States imposed a 10% rate to all Chinese products, which led China to retaliate with rates ranging from 10% to 15% in certain US products, which include coal, liquefied natural gas, oil Crude, agricultural and large machinery. Displacement cars.
China’s countermeasures, which will enter into force on Monday, also include adding two US companies, Illumina and PVH Group, owner of Calvin Klein and Tommy Hilfiger, to their list of unreliable entities. This movement severely limits the capacity of companies to operate in China, citing violations of the normal commercial principles of the market.
The situation remains uncertain, and some experts speculate that the two nations can accept an additional action to participate in the dialogue. Clark Packard, a member of the investigation of the Herbert A. Stiefel for Commercial Policies Studies of the Cato Institute, warned that if an agreement is not reached, the conflict could quickly increase, by CNN. “If a similar agreement is not reached, then I think it has the potential to be quite intense,” said Pckard.
Tariffs imposed by the US could lead to higher prices for US consumers, affecting a wide range of goods, including consumption electronics, toys and clothing. In addition, the increase in import costs of raw materials, such as rubber, plastic and chemicals, could negatively affect US companies.
The conflict can also have long -range consequences, including jobs losses both in China and the United States. Morgan Stanley economists predict that the United States will impose additional tariffs to China at the end of this year, which could lead to a greater reprisal in China.
A potentially more devastating scenario is a three -road commercial war that involves the United States, China and other nations, such as Mexico and Canada. Citibank economists warn that this could lead to significant economic contraction in the United States, with the planned economy that is reduced by 0.8% this year and -1.1% next year.
China’s economy would be affected less this year and the next compared to the United States, despite heavy tariffs, on the other hand, the economies of Mexico and Canada will be affected mainly compared to the United States.
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