Yukon Huang: Trading Blows: The US-China Trade War

The United States and China are in the trenches of a trade war, with damaging consequences for both sides. While China's economy is dependent on exports, with nearly 20 percent of its exports going to the US, industries in the United States reliant on imports are also feeling the pressure on their supply chains and may look to shift production outside the US in order to avoid higher production costs at home. The Trump administration is betting that China will back down and American companies will profit from protectionism.

Bigger economic challenges will emerge if the trade war continues. Faced with higher tariffs, China could struggle to find trading partners for exports it normally sends to the US. The negative effects of the trade war are also not limited to the US and China. South Korea, Taiwan, and Singapore are closely linked to China’s economy, and businesses which are part of the supply chain to China are also feeling the pain of tariffs. The UK, for example, is already reporting losses, causing it to increase prices on automobiles sold in China. What may come of this trade war and what are its long-term effects? Are the tensions between the US and China really about trade and technological dominance, or is this a great power competition for economic and strategic supremacy?

Yukon Huang is currently a senior fellow at the Carnegie Endowment in Washington, D.C. and was formerly the World Bank’s Country Director for China. Mr. Huang will join us to discuss the implications of the trade war for both China and the United States in terms of economic growth and their broader relationship.

SPEAKER:

Yukon Huang

Senior Fellow, Asia Program, Carnegie Endowment for International Peace

MODERATOR:

Markos Kounalakis

Visiting Fellow, Hoover Institution

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