USA and China Trade war Assignment

Added on - 21 Feb 2021

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Table of ContentsMAIN BODY...................................................................................................................................3Current state of trade war between the USA and China.........................................................3REFERENCES................................................................................................................................8
MAIN BODYCurrent state of trade war between the USA and ChinaTrade war is a situation of creating restriction in trade. It results from conflict betweentwo countries due to the various reason like political conflict, economic issues, increasing tariffrate etc. The increasing tariff rate and other issues are the reason behind creating trade warbetween the USA and China. US economy impose heavy tariffs on China because of its illegalpractices and or unfair practices (Handley and Limão, 2017).To threatened the China economy US impose US$250 billion slapped tariff on theChinese product. Against of the US action china impose US$110 billion tariff on the USproducts. Both countries are not willing to give up on increasing tariff rates which result tocreating trade war between two countries. And now US wants to increase the Tariff rate up toUS$300 billion.The increasing tariff would result to impact on the import, export, foreign directinvestment, economic growth of both countries. In regard to the section 301 trade act 1974 USgovernment gives a statement that because of the unfair practice and theft of intellectual propertyright of US, they increase the tariff (Davis, Fuchs and Johnson, 2019). US threatened the china toincrease the tariff rate by 25% if china is continued to doing the unfair practices or if china fail todo the quick trade deal with US to settled down their disputes.On 6 July 2018 US impose 25% tariffs on some goods but on 9 July 2019 they exempt110 Chinese products from the 25% tariff rate. Further the commerce Secretary announced toissue licence to this company which wants to sell products to Huawei. On 29 July US and Chinaare agreed on discuss and talk about the trade war and try to solve their issues. The aim is to holdthe tit for tat tariff because it highly affects the business of both country.
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