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Wednesday, June 19, 2019

How Might China Try and Capitalize on The Trade War to Set Up New Alliances

China is trying to limit some of the damage of the trade war with the U.S. by inviting other nations to increase trade with them. What they used to get from the U.S. they are trying to get from other nations. That will change how products and information flow throughout the world. A polarized world of military and commercial activity may be the long-term result of long-term trade adjustments.

1. Gap filling suppliers are likely to be permanently part of the Chinese economic engine once they begin working within the country.

2. China may have reached a point where it no longer needs to rely on the U.S. but move toward creating its own global network of commerce.

3. China will seek out countries that align closely with its own culture in terms of fundamental beliefs creating political connections along with financial ones.

3. They are capitalizing on low cost production enhance the reach of its market approach by a sector of countries.

There are a few things China may not have thought of.....

1. If the U.S. increases their innovative capacity they can product better products at lower prices thereby being a market leader.

2. Not all countries align ideologically with China and may end up solidifying support in Europe and other places.

3. A polarized world world will likely slow down commerce on both sides.

4. Much of the Chinese economy is resting on Europe and the U.S. A prolonged trade war may end up limiting both trade and information.

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