TITLE: Donald Trump Threatens New Tariffs if China Retaliates Link: https://www.

Question

TITLE: Donald Trump Threatens New Tariffs if China Retaliates

Link: https://www.wsj.com/articles/donald-trump-readies-new-tariffs-for-china-1529365844?mod=hp_lead_pos1

President Trump has asked his administration to impose tariffs on $200 billion worth of goods being imported from China. This comes after China said it would retaliate against the proposed tariffs on $50 billion in goods imported from China. The belief is that these retaliatory efforts by both countries will result is a full-on trade war. While the tariffs are primarily a method to encourage countries to negotiate their trade deals, it is being viewed as “chaotic” by some lawmakers.

What do you believe would be a consequence of a trade war with China?

Do you believe these tactics give the U.S. leverage in trade negotiations, or will potential trade partners begin to look elsewhere?

Explanation / Answer

One of the consequence of a trade war with china will be world will be devided into groups. Countries will make their own most favoured nation and the main problem will be for developing and pooe countries. Because America is imposing taxes on chinese imports to reduce their trade deficit. Inturn china also increased taxes on American products. So USA aim of reducing trade deficit was failed. USA is not giving respect to WTO. So now no country will abide by the rules of WTO. Every country will behave according to their interests. The main purpose of WTO is in danger of failure.

Do you believe these tactics give the U.S. leverage in trade negotiations, or will potential trade partners begin to look elsewhere?

Let us see what other countries are doing with USA

India is imposing a 100% tax on harley davidson motorbikes that are manufactured in USA. Trump asked Indian govt to reduce the rates. But Indian govt hasnt reduced. Harley Davidson told that they will set up plants in other european countries and from there they will export to India.

So overall idea of Trump to boost employment in USA failed as the company is ready to shift their manufacturing plant to EU.

So what I beleive is trading partners will look elsewhere.

WTO should step in and has to take control of the situation.

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