[Post 861] China Thinks It Can Outlast USA In This Tariff War: Does It Really Have The Upper Hand? | Insight

Summary

On Aug 12, President Trump approved the extension of the trade truce between US and China for another 90 days, keeping tariffs from skyrocketing for now. But there are no signs of a trade deal yet between the US and China, despite months of negotiations. Compared to President Trump’s first term, China seems less willing to make concessions this time round, considering that other major economies like the EU, Japan and South Korea have agreed to terms with the US. 

For years, China has sought to reduce its reliance on the US. Now, with less dependence on the US market, it can drive a harder bargain at the negotiating table. In addition, rare earth metals and manufacturing prowess are trump cards that China holds. Yet China’s domestic economy is sluggish. Other trading partners, which China needs to absorb the goods it diverts from America, complain of dumping of Chinese products.