US-China Trade War… The world’s two largest economies are at each other’s throats, but what does a trade war between the US and China mean for the rest of the world, and for your pocket?
The cost of your jeans
And even toys could go up in the near future.
This is because tariffs are being put on made in China products by the US.
Let’s break it down the Us and China are in a fight over trade.
But when two superpowers argue, it has a knock-on effect for the rest of the
SO WHAT IS A TRADE WAR?
It’s when countries try to damage each other’s trade …
By imposing tariffs, which is a tax on specific imports or exports.
BUT WHY SHOULD WE CARE?
Because you are probably consuming many imports.
If you’re reading this on your iPhone, it was designed in the Us but assembled in China.
And the key parts came from places like Japan & South Korea.
So if the Us puts a tariff on it, all these countries in terms of jobs will be affected. But also they have overheads to cover.
So they could put the price of the phone up for consumers across the world.
BUT WHY IS THIS US-CHINA TRADE WAR HAPPENING?
President Trump wants to have more goods made in The US to boost industry and jobs. And reduce the trade deficit basically, the Us buys from China more than it sells.
But China wants to be the world’s leader in tech like artificial intelligence. And has a plan to do this called made in China 2025.
SO WHAT’S HAPPENED SO FAR ?
The US has introduced tariffs on various industries including… Steel, aluminum and is threatening more.
China responded with their own tariffs on Us agriculture products, for example; soybeans.
BUT WHO COULD BENEFIT FROM THIS?
Countries that may fill the gap to supply US and China with cheaper goods…
Like Bangladesh’s cotton industry,
toy manufacturers in Mexico and clothes stitchers in Vietnam.
But most economists say that as goods become more expensive in trade wars…
It is the consumers who lose out…