US-China Trade War: Economic Impact on Global Politics

Abstract

The two economic titans, the US and China, have been at odds over the past years concerning their trade ties. The US and China are facing a series of trade tensions stemming from various concerns; from endemic to China’s economic model systematically tilting the playing field in support of Chinese companies locally and globally. The trade conflict has lowered real income in both the US and China, although not by large scales relative to GDP. This study aims to provide a comprehensive understanding of US-China trade relations and evidence-based conclusions. The US and China have become disruptive powers in the liberal trading system, not just via bilateral economic ties but also by their actions towards other nations. Otherwise, China and the US are decreasing the role of trade multilateralism in their relations with other governments and moving toward assertiveness and repression. The two most powerful countries’ disregard for the rule of law has led to the current impasse in the WTO, which poses a real threat to globalization. The existing trade affairs between the US and China demonstrate flaws in the global economic system and the difficulties international organizations face when encountering such disagreements. Although both countries maintain their financial dominance and adopt distinct trade strategies, international society has to go through the tangle of competition regarding economic influence and unpredictability in the regulation.