Geneva deal can't hide fact US-China trade war has no end in sight

South China Morning Post

a day ago

High-level trade talks between China and the United States in Geneva, Switzerland, last month
resulted in the suspension of most of the tariffs on each other. Despite that, a substantial amount of tariffs remains. While a 24 per cent duty was suspended for 90 days, both sides kept a 10 per cent tariff in place. In addition, the US retained
a 20 per cent tariff imposed over what the Trump administration says is China's role in the fentanyl crisis.
Advertisement
How might trade negotiations between China and the US play out? Beijing has called for the elimination of all of America's punitive tariffs on China. However, US President Donald Trump's approach to negotiations is likely to depend on several factors.
Trump seeks to extract maximum economic benefit from US trading partners. He has pressured Japan and South Korea to invest in a
natural gas pipeline in Alaska , demanded British market access for American beef and made a series of
demands on Vietnam , including insisting it remove its tariffs on US imports in exchange for tariff concessions. Trump will undoubtedly try to secure as many lucrative business deals as he can from China.
His handling of trade negotiations will also be determined by the impact of his China tariffs on the US economy and his voter base. Expect him to watch market dynamics closely as midterm elections approach next year.
Rising consumer prices and falling economic growth in the US in the next few months could push him to show more flexibility.
Most importantly, geopolitical calculus will shape Trump's approach to China, which he sees as the main adversary of the US and so must be contained. For this reason, his administration has continued to attack China despite the agreement reached in Geneva, warning before the ink was dry that using advanced Huawei chips '
anywhere in the world ' would violate US export controls.
Advertisement