On Friday A trade war broke out between the two world largest economies, the United State and China. basically, the trade war is on since the US has imposed tariffs on $34 billion of Chinese products after that in response to this China hit back tariffs on equal amount $34 billion on the United State products. so it is assumed by the analyst that the trade war between the two countries would affect the rest of the world and economy would get slow down.
According to one of the source, on Thursday, The president of the United State Trump hinted about his step against China and said that within two weeks it would impose a tariff on 50$ billion of the Chinese product by the United State if the capital of China, Beijing would take revenge like this and continues it with tit for tat measures. Trump also said very aggressively if China would not back down, another stake would be taken by him in such a way that he would increase the first tariff on 200$ of the Chinese product to $500 billion on Chinese products.
However, In the contrast, it is said by China that country would not “fire the first shot.”
Though only $125 billions goods are imported by China from the United state and it is expected by the Unites state president and his advisor that Beijing is to be compelled to address the 375$ billion trade deficit by buying more American products.
Although Geoff Raby, Australia’s former ambassador to China said that has seemed, Trump is being driven by “very short-term political considerations” ahead of The united state midterm elections in November.
Meanwhile, Geoff Raby also warned and said if it would not end at the time, There will be most probably be “escalation upon escalation,”.
“While our 900 member companies continue to suffer from not having the level playing field in China, they are still extremely clear: Increased tensions in the US-China economic relationship will negatively impact their operations China”. William Zarit, Chairman of the American chamber of commerce in China, warned.
according to Chinese Commerce Ministry spokesman Gao Feng, ”U.S. measures are essentially attacking global supply and value chains. To put it simply, the U.S. is opening fire on the entire world, including itself,”
As per the DBS note, the economies of South Korea, Malaysia, Taiwan, and Singapore are at risk in Asia based on trade openness and revelation to deliver chains. wherever it is expected to be a drag on growth in 2018, and it could double in 2019.