Source: East Asia Forum
Author: Wang Yong, Peking University
US President Donald Trump’s trade war against China and the world is subverting the global open trading order and effectively dismantling the World Trade Organization as the universal authority for the resolution of trade disputes. After imposing tariffs on steel and aluminium imports, the US administration has now slapped tariffs on US$34 billion of Chinese imports, and it is expected to do so for more imports from China in the future.
Shipping containers, including one labelled ‘China Shipping’, are stacked at the Paul W Conley Container Terminal in Boston, Massachusetts, US, 9 May 2018 (Photo: Reuters/Brian Snyder).
This trade friction has deep roots in the restructuring of domestic politics in China and the United States, as well as in changes in their perceptions of one another. While China–US interdependence and common interests continue to expand, technological and strategic competition between the two nations has come earlier than expected. Economic competition, combined with differences in ideology, development models and political systems, may push China and the United States into a new Cold War.
In terms of economics and trade, Trump is reversing two decades of US policy that emphasised online and high-tech sectors in favour of trying to revive US manufacturing to supposedly correct trade imbalances. In terms of foreign policy, Trump has challenged the long-held view of the liberal international order as one that …continue reading