Home Economy First Salvo Fired In US-China Trade War

First Salvo Fired In US-China Trade War

China and the USA have started a tit-for-tat trade war – but what’s really behind the dispute?

The tussle began when US President Donald Trump hiked tariffs on the import of Chinese steel and aluminium.

The increase was hardly worth the bother as America buys little of either metal from China.

But the move sparked a response from Beijing on $3 billion worth of food imports from the US – roughly the same value as China’s steel and aluminium exports to the US.

Now, Beijing has upped the ante with a pre-emptive strike by slapping a threatened tariff on $50 billion more of US imports.

Trump says that the trade balance between the US and China is unfair as Beijing demands US companies hand over technology secrets if they want to do business in China.

Technology at stake

The US has already moaned to the World Trade Organisation about the Chinese policy on the grounds Beijing is limiting the control businesses have to control and profit from their technology.

At the root of the dispute is the ‘Made in China 2025’ policy from Beijing which aims to make the country the world leader in the design and manufacture of electric cars, robotics and other advanced technology fields.

Trump wants to keep the technology in the US to boost the economy and jobs.

At stake is the is the globe’s most valuable trading relationship.

The US has a huge $375 million trade deficit with Beijing and risks losing 2 million jobs supported by exports to China.

Disgruntled countries

China risks losing a slice of that trade and equally has millions of jobs riding on contracts with the US.

Beijing wants a fundamental switch in the relationship. Instead of building factories to make American technology, the government wants to produce and make the technology in China.

Although most of the world’s phones, computers and consumer technology come from Chinese factories, the research and development – and the profits – are based in other countries.

Other countries are also disgruntled with their trade pacts with China – including the European Union and Japan.

Europe has complained for years about China dumping cheap steel on the market that is subsidised by Beijing to keep steel works open to save jobs.

Farid Shojaei
Farid Shojaei
Farid was born in Tehran but his family immigrated to Germany when he was 7. He finished his elementary and secondary schools in Germany but he returned to Iran on 2007. Shojaei attended the Shiraz University to study economics. A year after he became a volunteer writer of Pars Herald. On 2009 he joined the group in full time. His guidelines for the group were excellent and he was admired by other reporters in the country. City: Shiraz Phone Number: +989356998914 Email: Farid {at} ParsHerald.com Name in Persian: فرید شجاعی

Stay Connected


Must Read

How Safe Is A Visit To The Caribbean?

Expats, tourists and business people visiting the Caribbean may well worry about their safety after a seemingly endless series of warnings and alerts over...

How Safe Is A Visit To The Caribbean?

Expats, tourists and business people visiting the Caribbean may well worry about their safety after a seemingly endless series of warnings and alerts over...

Huachuma – A Guide to the Plant Medicine San Pedro

Huachuma also known traditionally as The San Pedro Cactus, can be found throughout the Andes Mountains as they stretch across the South American countries...

Computer Hardware Prices are Increasing in Iran

As the financial and economical sanctions imposed by the United States and European Union are annoying Iranian businesses, the computer hardware prices are increasing...

Related News

Google Laying Cable

Google has teamed up with a selection of other companies to lay a cable across the Pacific Ocean (or under it) to give faster...

Protectionism, Tariffs And Trade Wars

America and China are at each other’s throats in a trade war while Europe waits on the wings fearing the continent will be dragged...

Initial Coin Offerings Ripe For Scams, Regulators Tell Investors

City watchdogs are warning speculators that initial coin offerings (ICO) are high risk and could lead to investors losing their stake. The UK Financial Conduct...

Syria Ceasefire Holds But War Of Words Strands Aid Convoy

The Russian-US brokered ceasefire seems to be holding in Syria – but a battle of words between rival warlords is stopping vital food and...

Trump – No Substance Behind The Smoke And Mirrors

After digesting the soundbites meant to catch the media headlines, does anyone really know what Donald Trump’s policies are if he should become president? Trump...


Please enter your comment!
Please enter your name here