Japan, Taiwan, and South Korea are emerging economies of the globe. These emerging economies trade with China. They sell their products to Chinese consumers and also supply raw material which is assembled in China.
The global trade volume is slowing down since the stiffening of sanctions and rise in tariffs by the two economic giants in the United States and China. Escalation of tensions has affected the economies of export-dependent nations including Japan, Taiwan, and South Korea.
The United States and China are not ready to give up. Both countries are trying to play smart in order to counter one another in trade, security, and technology. The United States blacklisted Huawei which is a Chinese telecom brand. The move sparked further ‘violence’ in terms of trade. National security interests drove American stakeholders to impose an embargo on one of the leading telecom company.
Trade war between China and the United States
The investors are eyeing the G-20 summit which is scheduled at the end of this month in Osaka, Japan. Donald Trump has said that there are no chances of sideline meeting with the president of China. Additionally, he gave a hint of further price hikes in the form of taxes on Chinese products afterward.
If the tensions de-escalate, this would result in quick recovery in stock markets of Japan, Taiwan, and South Korea. In case the trade war lingers on, these three economies are going to suffer the most.
Many critics have repeatedly said that the trade war between the United States and China doesn’t make any sense. Others are of the opinion that Trump has shot himself in his foot with his recent ‘trade package’.
Chinese imports to the U.S affected by trade sanctions include petroleum, oil, airplanes and yellow soya beans. American products to China which suffered a setback includes technological products mainly modems, routers and circuit boards.
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