TRADE WAR ASSIGNMENT.docx - TABLE OF CONTENTS 1.0...

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TABLE OF CONTENTS 1.0 Introduction 1 2.0 Ongoing US-China trade war 1 3.0 Reasons both countries implement tariffs2 4.0 Effect of US-China trade war to both countries 3 5.0 The spill-over on other Asian countries (South Korea and Malaysia) 4 References i
1.0 Introduction Trade war is defined as a conflict between the two countries about the tariffs on each other to protect their own country. This is the side effect of protectionism that occurs when both countries have a conflict about tariffs. Usually this conflict arises because they are trying to improve their own imports and exports. A tariff is a tax that charged on imported goods and services. Protectionism represents government action and policy that limiting the international trade to protect the local businesses and jobs from outside country’s competition. Trade war can begin if one country sees another country's trade have an unfair or when domestic unions press the politicians to make import items less attractive to the consumers. Trade war is also one of the misunderstood benefits of free trade. 2.0 Ongoing US-China trade war According to Dollar (2018), the ongoing US-China trade war that took place between the United States and China had a major issue going on. On 8 July 2018, President Donald Trump declare that United State imposed a 25 per cent tariff on imported goods that worth USD34 Billion from China, following tariffs imposed on steel, washing machines, aluminium and solar panels. After that, the Chinese Government immediately take a revenge with a 25 percent tariff on imports of US soy beans, other agricultural products and automobiles. According to Hui (2018), on 24 September 2018, United State escalated the trade war with China by impose another 10 per cent tariff, and worth USD 200 Billion of China products and may increase to 25 per cent at the end of 2018. After the increasing the tariff by US, China again retaliated with tariffs on USD 60 Billion of US goods and the same time, the importance of the good bilateral trade relationship. President Donald Trump says that he wants to stop the unfair transfer of technology and intellectual property of America to China and he wants to protect jobs. The tariffs will 1
make the US products cheaper than the import products and to increase the local consumers to buy the local products. This strategy encourages the local business to improve their business and support the national economy. However, many of US companies have testified

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