One of the most important conflicts occurring today is not on a military battlefield, but instead is on the trade battlefield. The United States and China are locked in a battle over trade, tariffs, and market access. Both countries recently announced the next set of products that will be subject to tariffs if a negotiated agreement does not occur. Which country has the upper hand?
- We’ve already heard about farmers and various manufacturers suffering reduced sales in the US as a result of tariffs already in place
- Next round – if they occur – will impact consumer prices bought from China
- But trade is relatively more important in China than in the US as a part of the economy
- Also, China has suffered a big drop in the value of their currency, whereas US dollar’s value has increased
- US economic growth rate has been increasing, whereas opposite is the case for China
- So seems like cards right now favor the US – big question – when will a deal occur
The Economic Perspective is an NC State Extension program from the Department of Agricultural and Resource Economics.