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of American companies so often as to disrupt production ”. American companies do significant business in China that doesn t show up in trade data. When Apple assembles an i - Phone in Zhengzhou and sells it in Shanghai, that doesn t count as international trade, though the profits accrue to the benefit of the California based company. The Chinese Government has any num- ber of tools to try to weaken that business if it wishes. It could decide that phones made by a foreign company are a national security threat or shut down plants be- cause of minor regulatory problems. 22 The importance of the US - China relationship is already being challenged by other players. Apple s i - Phone sales in China are running into competition from local Chinese manufacturers. Samsung is more than happy to fill any void that the Chinese can t deal with. Likewise, the Chinese would happily shift their trillion dollars in future aircraft purchases to Airbus, a European firm that is already building a plant in China to finish assembly of large, twin - aisle jets. As for automobiles, most Chinese would just as soon drive a Mercedes, BMW or Lexus in place of say a Ford. 23 The details of what China might do are speculative. Thus far, China s government has reacted to new tariff actions by the Trump administration with rel- atively restrained words and promises of proportional responses to the American government s actions. The tariffs won t even go into effect until after a comment period, setting up a potentially long period of lobbying and negotiation that could 22. Neil Irwin, If There s a US - China Trade War, China May Have Some Unconventional Weapons ’”, The New York Times, April 5, 2018, available at: https:// - china - trade - war - unconventional - retaliation.html? emc=edit_mbae_20180405&nl=&nlid=7575417020180405&te=1&login=smartlock&auth=login - smartlock 23. Winter Nie, Why China Doesn't Need The US For Trade ”, February 7, 2017 available at: - china - doesnt - need - the - us - for - trade/#5c295a853969
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US - CHINA Trade War: Analyses of Deeper Nuances and Wider Implications 23 rein in their scope or even delay them indefinitely. But, just because matters have been calibrated thus far doesn t mean they will stay that way. There are a number of issues that will be deferred to avoid confrontations as long as possible. Perhaps President Xi Jinping can simply wait - out the current US administration. China can play the long game better than any other country to- day and has proven that in any number of instances. A senior Chinese economist with close ties to the government said: However, there is a deal that could be struck, as both sides have a lot to lose, especially China, as we are not ready for economic warfare with such a big power as America. What scares me, and many government officials, is the rhetoric is heating up very quickly, leaving both sides very little room to work out a deal.
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