Jakarta – Trade wars between the United States and China are expected to continue. Until now, there has been no agreement that has had a positive impact on both the country and the global economy.
“The meeting of President of the United States Donald Trump and Chinese President Xi Jinping at the 14th Summit of the G-20 ago only alleviated the situation of short-term warfare,” said Pingkan, Center for Indonesian Policy Studies (CIPS) researcher Audrine Kosijungan, Wednesday (3/7).
1. Donald Trump’s statement caused upheaval
According to Pingkan, negotiations between the two presidents at the G-20 summit at the end of June gave a glimmer of hope. The negotiations did not result in the imposition of additional tariffs.
“The tariffs currently imposed by the two countries are not revoked. The two presidents also expressed efforts to reset trade negotiations between the two major power countries,” he said.
However, continued Pingkan, Donald Trump’s statement on one occasion again caused turbulence in his country. Trump said Huawei could return to buying US products in the near future.
This was responded to negatively and was said to be in a hurry to revoke a policy that was originally indicated to safeguard US domestic security.
“In addition, it raises questions about the continuation of trade negotiations,” Pingkan said.The government is asked to be careful about dealing with trade wars
2. The government is asked to be careful about dealing with trade wars
Seeing these conditions, he continued, he predicted that the dynamics of global trade would continue. Therefore, the government needs to continue to be careful in dealing with trade wars. According to him, the possibility of a quick decision change indicates the possibility of changes to other policies.
“As has been the case in the United States today after the G-20 Summit. Nevertheless, the statement was welcomed positively by the Chinese government which indicated that it would buy back agricultural products from the United States,” he said.
3. Amrik-China has been involved in a trade war for one year
The G-20 summit which took place in Osaka, Japan on June 28-29 2019 then again brought together leaders of the G-20 member countries, including the United States and China. Since the past year the two countries have been intensively imposing import barriers on each other.
“The meeting is expected to be able to reduce the tension of the trade war that had heated up in the middle of the second quarter of this year,” Pingkan said.
A few weeks before the G-20 summit took place, China retaliated with rates of between 20-25 percent for US products. The rate of this increase from the original range of 5-10 percent with a total value of US $ 60 billion. This is done by China after in May 2019, the United States increased import tariffs to 25 percent of Chinese products which reached a value of US $ 200 billion.
4. Impacted trade war on solar panel import tariffs
The trade war between the two major countries originated from the steps of the United States government who wanted to reduce the difference in trade balance with China. At the beginning of 2018, Donald Trump instructed the imposition of import tariffs by the United States for solar panel products.
This policy affects trade between the United States and China which is the largest producer of solar panels in the world. Entering March and April 2018, the president who is also a property entrepreneur returned to maneuver by applying import tariffs for steel products by 25 percent and aluminum by 10 percent to cut the US trade balance deficit with China.
5. War rates last until October 2018
This policy triggered the retaliation of the Chinese government by imposing import tariffs on 128 US agricultural products equivalent to USD 50 billion. It was also responded quickly by Washington by imposing a ban on the sale of telecommunications manufacturing products to ZTE companies for seven years. In May 2018, Washington and Beijing negotiated. However, this did not have a significant impact.
Two months after the negotiations were held, China imposed import tariffs on 545 US products equivalent to US $ 34 billion. In response, the United States imposed an import duty of 25 percent. This tariff war continues until October 2018.
Only in December 2018, to coincide with the G-20 Summit in Argentina, the tension of the trade war decreased. Only, five months later, Donald Trump again issued a policy that shook the world economy and dragged the Chinese telecommunications industry, Huawei.