TRADING BLOWS
How SA could be collateral damage in Trump's war against the Chinese
SA risks being a minor casualty as the US and China square up for a trade war. It should stay neutral — picking sides could be disastrous
If China and the US entered a trade war, would SA lay low or would it side with China, its emerging-country Brics partner, irritating the US and endangering SA’s free-trade preferences with the Western trading giant? The question is not purely academic. US President Donald Trump’s administration has just launched a unilateral investigation into China’s trade practices using the outmoded section 301 of a 1974 trade law that bypasses World Trade Organisation (WTO) rules. China considers the move inflammatory and has warned that it could launch reciprocal trade measures. Unless handled with kid gloves, the US investigation could well escalate into a full-blown trade war. In Trump’s view, the US trade deficit is caused by "cheating" trade partners as well as currency manipulators, including China, Mexico, Japan and Germany.In 2016, the US trade deficit with China was US$347bn. This is because the US imports four times more from China ($463bn) — mostly consumer electronics, clothing and ...
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