China would be the one sounding the trumpet when the ongoing trade war between the two largest economies ends. While currently there is no end in sight for the escalating tit for tat between China and the United States, Independent Strategy's President and Global Strategic David Roche believed it would work out for the best for the Asian powerhouse.
When all is said and done, the U.S. has forever lost China's trust and the latter would, therefore, continue to be independent of America for its imports and exports and other bilateral financial relations, Roche said. And while both parties agreed for renewed negotiations in October, he believes the dispute would linger because the conflict between the two economies transcends beyond trade.
Roche said the trade war is actually a conflict between a rising superpower, China, and declining global power, the U.S. For that, expect more tirades and other retaliatory moves from the two in the coming years, the global strategist said.
Roche's opinion was echoed by Niall Ferguson, a senior fellow at the Hoover Institution at Standford University. He said that the conflict between China and the U.S. is almost at the same level as to how relations went down during the Cold War.
Since his presidential campaign in 2016, now President Donald Trump has been accusing China of unfair trade practices that include breach of intellectual property rights, forced transfer of U.S. technology to Chinese firms, and limited access of American companies to China's markets.
The American president has been out of allegations and distasteful words way too many and far too insulting that he is far from mending ties with China, Ferguson said. The damages the controversial president has brought the Asian powerhouse are already far from being repaired. The disagreement has escalated that it was not about trade anymore, he said.
Meanwhile, White House adviser Peter Navarro requested for investors to be patient as both parties try to find a resolution. He reiterated that meeting between China and the US in October may finally bring peace.
The world's two largest economies have imposed retaliatory tariffs on billions of their respective imports and exports since 2018. The disagreement has brought the markets to its most unpredictable level in decades with consumers and investors never been this anxious since the Great Recession.
Interestingly, while Trump's wrath against China was rooted in a belief that China is taking advantage of America's open trade, and his sanctions and tariffs could cripple the country, China's manufacturing sector surprised markets when it rebounded to a five-month high in August. Data from the Caixin China General Manufacturing PMI hit 50.4 in August, up from 49.9 in July.
