/ China - U.S. Trade War

For more than a year now a trade war has been raging between the two most powerful markets in the world- the U.S. and China. The impacts of this economic conflict, however, are not limited to these two countries alone. Because of the extensive influence that each country has, the trade war has created a bipolarity wherein all parties who are associated with one side or the other must choose who they stand with between the U.S. or China. Economically speaking, tariffs create economic inefficiency. In limiting free trade, those participating in the trade war are affected, as well as those otherwise associated. This economic conflict is proving to be divisive enough to have been compared to an economic cold war[1], a war that undermines trade on a global scale.

U.S. President Donald Trump started the trade war by implementing tariffs on Chinese imports, to which China responded in kind. The U.S. government cites several causes for initiating the trade war including a growing trade deficit, the theft of intellectual property by applying pressure to companies so that they transfer technology and intellectual property, government-sponsored investment and/or acquisition of U.S. companies and assets, and cybersecurity hacking, among other things.[2] The U.S. initiated the tariffs in an attempt to demand changes and improvements in relation to unfair trade practices between the two nations. While negotiations are underway between the two governments, no decisive agreements have been made. If this conflict persists, the long-term consequences of this trade war could include a divisive blow to the European Union and the cohesion of its member states, forcing countries to choose sides between the two super-powers rather than facilitating free trade according to the intended purpose of the union.

One underlying concern of this trade war is whether or not the U.S. is making use of its economic grievances to stymie the Chinese in their economic efforts to expand their influence through efforts like the Belt and Road initiative (BRI) out of fear of being surpassed or losing power and global influence. As members of the European Union and thereby a deciding power capable of encouraging the U.S. and China to seek an equitable solution to the present trade war, the member-states of the European Union need to come together and stand united behind an open-minded solution that furthers the cause of free trade, economic stability, and greater economic interdependence so that protectionism and self-interest do not win out at the continued expense of the global free market and initiatives that drive international interconnectivity like the Chinese BRI and other infrastructural projects.