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In: Economics

1) five ways china could counter the sino-US trade friction Q2. In growing and cultivation, its...

1) five ways china could counter the sino-US trade friction

Q2. In growing and cultivation, its more of manual labor, but in processing and storage, its highly mechanized

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Expert Solution

Qn .1. The increasing trade war between china - usa leaves greater economic impact on both the sides , perhaps affecting the global trade. Here are some measures through which china can counter trade war .

1. Imposing counter tariffs on us exports , though it does't seem to be an effective one , is considered as one of the measures. Such a tit-for-tat movement could only help erode the economy of both , and more or less could adversely impact other countries.

2. Imposing strict regulations on us firms based in china. This might include visa rejection , procrastinating clearances to us firms etc. This is going to affect the revenue of us companies from china.

3. Boycotting us goods and allow / incentives to chinese people to consume more and more domestic goods or goods from countries other than usa. This move will affects the revenue of usa from china.

4. Deliberately allow the chinese currency chinese yuan ( renminbi ) to depreciate against us dollar ., so that people of usa would sell out more and more us dollar to purchase chinese yuan to purchase cheaper chinese goods.

5. Chinese government can increase income levels of chinese people so that they can spend more .this increases demand and manufacturers hire more workers to meet this demand.this increases wages again spending goes up. This will going to help step up chinese economy.


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