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FUNDAMENTALSOFINTERNATIONALTRADE.(I
US AND CHINA TRADE WARINTRODUCTION (Nature and scope of the problem)US and China trade war is an ongoing economic conflict between the two nations. China believesthat the US is trying to limit its rise. Both countries have been increasing the trade tariff since 2018.The trade war results from raising import tariffs or other restrictions on other countries imports. Theongoing trade conflict between the US and China has had significant global repercussions. Due to thetariffs and taxes imposed by both nations, the rising trend of globalization over the past 20 years hasstalled and may decline. Since the early 1900s and the Industrial Revolution, globalization has beenincreasing. Before conferring the trade war between China and US economies, the small introductionwould be there. China is an emerging and developing economy. Despite being a developing nation,China is the world's largest exporter and exceeded US exports. Low-cost manufacturing centreshelped China to become an export hub. America is a leader in many aspects, such as trade, stocks,credit, energy, and commodity markets. The US claimed that China is stealing technical expertise andscientific secrets to become a global leader. The vision of its absolute dominance in the globaleconomy has come into conflict with the growing imbalance in bilateral trade with China, increasingcompetitiveness of high-tech companies and an increase in China's investment export(Kapustina etal., 2020). These are economic conflicts and may impact the global economy in the long run.There have been agreements in this context to minimize the effect of trade tariffs; for instance,countries signed an agreement to reduce the tariff in January 2020. The impact of the Phase oneagreement on the global economy is even more negligible. However, the US is projected to turnactual income losses into real gains because of the Chinese commitments to buy additional USgoods(An Economic Analysis of the US-China Trade Conflict, 2022). US authorities believe that Chinais following unfair trade policies and exploiting the rights of being a member of the WTO. Thebilateral conflict between the two economies is increasing day by day. For instance, politics, humanrights, and cyber security are essential to the conflict. The trade deficit is the major problem which isfaced by the economies. Therefore, there is a need to understand the cause of the problem. Thisassignment would help to understand the underlying reason for the problem and how we mayimprove.Source-US China bilateral trade (US Census Bureau)The above diagram represents the US imports from china and US export to China. US import fromChina is more significant than US export from China.1
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