Trade War

11-03-2018

Trade War between US and China impact on world economy

4 days ago, America’s President Donald Trump announced that the US is ready for the trade war with other countries, if they retaliate against the new import tariff plans on steel and aluminum. Now every expert, analyst on world economy, news channels have started to discuss and debate on “Trade War”.

      This term – “Trade war” may seem alien to a common man. In 21st century, the countries may not fight on the borders with destructive weapons but starts to damage each others trade collaborations. It could be mostly done by imposition of tariff plans and trade regulation on import and export. Such incidents happening around us in present give us the hints of future events and trends. Decision taken by US govt. gives pretext that the place of sword and guns will be taken by the business or trade rules and regulations. Trade is a major contributor to a country’s economic growth and expansion after globalization.

      Other governments may follow in the footsteps and impose more rules and regulations on Import. This will increase the prices on imported items, products, which will ultimately impact consumer and common people. To tackle this, governments will invite manufacturers to produce and sell the products in same country. This will be win-win for both governments and businesses. As it will help to  create more job opportunities in a country and also help manufactures to keep their product prices low and competitive.

        Still global investors are unclear of the impacts of such initiatives and will show negative trend in world indices for short time. But, in long term this will show positive results and same will be reflected in global market.