The cost of the Chi­na–U.S. trade war

États-Unis-Chine, une guerre com­mer­ciale lourde de consé­quences.

Vocable (Anglais) - - Sommaire - RO­BYN DIXON

En sep­tembre der­nier, Do­nald Trump an­non­çait la mise en place de nou­veaux droits de douane sur 200 mil­liards de dol­lars de pro­duits d’im­por­ta­tion chi­noise. Pé­kin ré­pli­quait aus­si­tôt avec une taxe doua­nière sur 60 mil­liards de dol­lars de biens amé­ri­cains. Ces me­sures marquent une nou­velle étape dans la guerre com­mer­ciale dé­clen­chée par Trump cette an­née. Quelles en sont les consé­quences pour les tra­vailleurs et consom­ma­teurs amé­ri­cains ?

Bei­jing — The shelves of Bei­jing’s luxu­ry su­per­mar­kets are cram­med with fa­mi­liar pro­ducts that Ame­ri­can ex­pa­triates can­not seem to do wi­thout, from break­fast ce­reals with just the right le­vel of su­gar and crunch to smo­ky sal­ted nuts and clea­ning pro­ducts with the cor­rect amount of oomph.

2. But Wes­ter­ners — the main cus­to­mers in su­per­mar­kets like Jen­ny Lou’s, Jen­ny Wang and April Gour­met — will have to pay more for a taste of home, ac­cor­ding to Jen­ny Lou’s ma­na­ger, Ro­cky Jia, with Pre­sident Trump mo­ving for­ward with stiff new ta­riffs, the la­test round of which, af­fec­ting $200 bil­lion worth of goods, was an­noun­ced [on Sep­tem­ber 17]. Chi­na vo­wed to re­ta­liate with tax in­creases on $60 bil­lion worth of U.S. im­ports, in­clu­ding cof­fee, ho­ney and che­mi­cals — and ana­lysts pre­dict a long, un­cer­tain bat­tle ahead.

3. Some fa­mi­liar pro­ducts, like cer­tain Oreo coo­kies and Skip­py pea­nut but­ter, are pro­du­ced un­der li­cense in Chi­na and would pro­ba­bly not go up in price. But ma­ny others are im­por­ted and li­ke­ly to see steep mar­kups, Jia said. In su­per­mar­kets of such Bei­jing neigh­bo­rhoods as San­li­tun, re­mi­nis­cent of the U.S. or Eu­rope with its bars, ea­te­ries, shop­ping malls and tree-li­ned streets, some Wes­tern cus­to­mers said they would not be co­wed by price hikes.

4. Des­pite the brand loyal­ty of ma­ny cus­to­mers, Jen­ny Lou’s, which im­ports about 30 percent of its stock from the U.S., is bra­cing for a big im­pact on prices and pro­fits. The su­per­mar­ket chain laun­ched in 1988 and has 10 stores, with al­most three-quar­ters of its pro­ducts from over­seas, Jia said. Al­though some Wes­ter­ners say they would conti­nue to buy their fa­vo­rite Ame­ri­can wares, Jia said that if prices rose stee­ply, some would pro­ba­bly choose si­mi­lar pro­ducts ma­nu­fac­tu­red in Eu­rope.

AT STAKE

5. Ma­ny U.S. com­pa­nies doing bu­si­ness with Chi­na are fa­cing si­mi­lar pain­ful choices in coming months. “My sense in com­mu­ni­ca­ting with people in the Chi­nese and U.S. go­vern­ment is that both sides are har­de­ning their po­si­tions and that nei­ther is willing to take the kind of uni­la­te­ral ac­tion that would re­solve the si­tua­tion,” said Ja­cob Par­ker, vice pre­sident of Chi­na ope­ra­tions at the U.S.-Chi­na Bu­si­ness Coun­cil. “The U.S. go­vern­ment is wai­ting for the Chi­nese go­vern­ment to show good­faith ef­forts such as an­noun­cing (that it is) im­ple­men­ting new li­be­ra­li­za­tions that al­low Chi­na to ope­rate more like a mar­ket eco­no­my. “Chi­na views those li­be­ra­li­za­tions as ne­go­tia­ted bar­gai­ning chips that it will not give up uni­la­te­ral­ly.”

6. The Trump ad­mi­nis­tra­tion wants Chi­na to stop res­tric­tive trade prac­tices, such as for­cing fo­rei­gn com­pa­nies to hand over key tech­no­lo­gies in re­turn for ac­cess to Chi­na’s vast mar­ket. It al­so wants fun­da­men­tal long­term changes, de­man­ding that Chi­na ope­rate more like a mar­ket eco­no­my, less re­liant on sub­si­dies to state firms that make it dif­fi­cult for out­side com­pa­nies to com­pete. But the more the trade war piles pres­sure on Chi­nese lea­der Xi Jin­ping, the less willing he may be to cave in, be­cause it would mean hu­mi­lia­tion and loss of face. Ana­lysts warn the trade war is li­ke­ly to be pro­trac­ted and pain­ful.

RISKS FOR U.S. COM­PA­NIES AND CONSUMERS

7. While Chi­na is unable to match the U.S. dol­lar amount on ta­riffs be­cause it im­ports less from the U.S. than it ex­ports, it has my­riad ways to make Ame­ri­can com­pa­nies, consumers and far­mers feel pain. Chi­na is an im­por­tant mar­ket for U.S. cher­ries, for example, and Chi­na not on­ly tar­ge­ted cher­ries with ta­riffs but al­so im­po­sed a new week­long qua­ran­tine per­iod, en­ough to make fruit spoil. Ta­riffs alone cost Nor­th­west cher­ry far­mers at least $86 mil­lion this past sum­mer ac­cor­ding to the Nor­th­west Hor­ti­cul­tu­ral Coun­cil.

8. Im­por­ted Ame­ri­can cars in Chi­na are sub­ject to a 40 percent ta­riff, ma­king it im­pos­sible for them to com­pete with im­por­ted Eu­ro­pean cars that face a 15 percent ta­riff. Par­ker said a wide range of U.S. com­pa­nies face cost­ly ins­pec­tions, de­lays and re­gu­la­to­ry scru­ti­ny. One car ma­nu­fac­tu­rer re­cent­ly saw its ran­dom ins­pec­tion rate jump from 2 percent to 100 percent, he said. Clo­sed in­ves­ti­ga­tions in­to the prices Ame­ri­can com­pa­nies were char­ging have been abrupt­ly reo­pe­ned. Even ad­ver­ti­sing slo­gans, used for years, were sud­den­ly being ques­tio­ned. “We feel that there’s en­ough anec­do­tal evi­dence to in­di­cate that there’s so­me­thing of a trend hap­pe­ning,” Par­ker said.

9. Ano­ther risk is that om­ni­present bu­si­nesses such as Star­bucks, McDo­nalds and KFC could face a consu­mer boy­cott. Both coun­tries ap­pear to be­lieve they will win the trade war. Chi­nese state me­dia com­men­ta­ries say the eco­no­my is strong en­ough to out­last the U.S. Trump, meanw­hile, said [on Sep­tem­ber 18 that] the U.S. might slap ta­riffs on ano­ther $267 bil­lion in Chi­nese goods. “We don’t want to do it, but we pro­ba­bly — we’ll have no choice,” he said.

10. Chi­nese Com­merce Mi­nis­try spo­kes­man Gao Feng said that the U.S., see­king to make Chi­na a sca­pe­goat for its own pro­blems, had star­ted a trade war that would un­der­mine world trade and harm its tra­ding part­ners. He said Chi­na would pur­sue a range of mea­sures in re­ta­lia­tion, wi­thout de­tai­ling what would be done apart from rai­sing ta­riffs. “Chi­na has made full pre­pa­ra­tions to de­fend the in­ter­ests of the na­tion and the people,” Gao said.

Both coun­tries ap­pear to be­lieve they will win the trade war.

(Tri­bune News Ser­vice)

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