Question

Your firm designs, manufactures, and markets children’s toys for sale in the U.S. Almost90% of your production is done in China. During the 1990s, U.S. relations with China improved.Even though there were many disagreements between the two countries, the United Statesgranted normal trade status to China and supported China’s membership in the WTO in 2001.Your firm invested heavily in China during that time. You have developed close ties to Chinesesuppliers and have come to depend greatly on inexpensive Chinese labor and the lower costs ofdoing business therYou are now concerned about increasing political tension between China and the United Statesover a variety of issues: China’s s treatment of the Tibetan people, reports about the use of prisonlabor to manufacture goods for export, China’s population policies, and differences over relationswith communist North Korea. The United States has also accused China of corporate and industrial
espionage in the United States to obtain scientific, industrial, and trade secrets, and of hackinginto corporate and government computer networks. There are also disagreements over China’s
censorship of Internet search providers, and over the protection of U.S. intellectual property rightsin China. The United States is also concerned with China’s tax policies, which are said to discriminate against imported goods, and also with China’s state subsidies to domestic industry.
The U.S. accuses China of currency manipulations of the yuan, making Chinese goods unfairly cheap in foreign markets and imports into China artificially expensive. Most worrisome is the potential for conflict over Taiwan, with which the United States has had a mutual defense pact for 60 years. China claims Taiwan under its “One China” reunification policy, while accusing the United
States of fostering “independence” there. Despite the issues, both countries recognize their deep economic reliance on each other
Provide a conclusion about us and China trade issues by analysing the above statements and provide suitable recommendations for avoiding them? provide answer with 1 academic reference?

Answer 1

Reference: The Changing Fundamentals of US-China Relations By Evan S. Medeiros httpss://www.tandfonline.com/doi/full/10.1080/0163660X.2019.1666355

• The primary objective of globalisation and International trade is to compensate the needs of partners in a scenario of diverse geographical, human , resource availability conditions that makes no country absolutely self-sufficient.
• Any diversion from this basic principle of Gravity, as seen in case of China leads to application of unfair means of trade to gain more foreign exchange and richness.
• The USA had been experiencing a steep trade deficit with China since years. These days the Chinese aggressive behaviour towards many countries has led to a tariff war between USA and China.
• However the trade war between them has affected the international mobility of goods to a large extent.

Suggestions:

1. Both the countries need to come together to an agreement of consensus in terms of trade and strictly adhere to that.
2. Avoiding use of unfair means of dumping and tax evasion must be withdrawn by China.
3. The consensus on growing together is vital for trade resilience in the region.