The US And China Trade War Has Hit The Global Economy.

The world's two largest economy, the US and China, used the tariffs in August 23rd (2019) to criticize each other, resulting in a renewed trade tensions between the two countries, which damaged the global supply chain and hit the financial markets.

China said it would levy 5% to 10% retaliatory tariffs on US $75 billion worth of goods. At the same time, trump also announced that the tariff rate of $250 billion on Chinese sales to the United States increased from 25% to 30% in October 1st, and the tariff rate of 300 billion dollars on Chinese sales of commodities in September 1st was raised from 10% to 15%.

Although trump can not force us enterprises to abandon the Chinese market immediately, trump ordered the US companies to take action to quit China, making the second year trade war a new turn.

The following is the price of Trump's efforts to reinvent Global trade norms with China and other major trading partners:

(1) global economy

Fitch Ratings estimates that tariffs on China will further expand to $300 billion, which will reduce global output by 0.4%.

The International Monetary Fund (IMF) said (7) that global trade in the first quarter of this year was the slowest growth since 2012, and said that if more tariffs were imposed, the world economy would face severe downside risks.

(two) agriculture and energy

So far, American farmers have been hit most severely. China is the largest export market for major crops in the United States, and this retaliatory tariff for us agricultural products may be attributed to the vote of the US farmers to trump to help him become president of the United States.

China's new tariffs also include US crude oil, which has led to a fall in crude oil prices. US crude oil fell 3.47% to $53.40 a barrel, while Brent crude dropped 2.27% to $58.56 a barrel.

(three) technology

Technology stocks were the worst hit areas. The standard & Poor's 500 index closed down 3.2% in August 23rd, and the Philadelphia Semiconductor Index, which was subject to tariffs, fell 4.4%. The price of NVIDIA Corp. and Apple Corp Apple Inc. fell by 5.3% and 4.6% respectively.

American consumer Technology Association (Co) Nsumer Technology Association, a statement submitted to the US trade representative in June, said tariffs caused the US technology industry to lose $1 billion 300 million a month. The association pointed out that the US tariff increase plan will raise the retail price of mobile phones by an average of 70 US dollars, and the price of notebook computers will increase by US $120, and the console price will increase by US $56.

(four) retail industry is facing difficulties.

Retailers in the US say tariffs, which will come into force in September 1st and December 15th, will have a particularly serious impact on consumers.

The American Apparel & Footwear Association estimates that 15% of new taxes will be imposed in September 1st, which will impact 77% of clothing, footwear and household textiles imported from China or about $39 billion worth of goods.

(five) automobiles and machinery

If carmakers abandon the Chinese market, sales will face serious risks.

General Motors Co. went to sell more than 3 million 640 thousand cars in China in 2018, accounting for more than 43% of the world's sales. Ford motor (Ford) announced its Asia Pacific revenue of 12 billion 400 million US dollars last year. Ford did not disclose its revenue in the Chinese market, but the Chinese market accounted for the majority of Ford's sales in the Asia Pacific region.

Deere & Co., an agricultural machinery and equipment manufacturer, cut its full year profit forecast for the second time in 3 months, and said that factories in Illinois and Iowa will cut production in the second half of the year.

(six) other industries that have been damaged

In early 2018, the United States took the lead in imposing tariffs on steel and aluminum, including products imported almost all over the world. This has benefited American steel producers but is not good for manufacturers of steel.

According to data from the American Action Forum, tariffs on US steel and aluminum buyers last year were nearly $5 billion.