The USA seems to start quite aggressive politics towards the influence of Chinese economics on the global trade. The decision of Donald Trump to impose a limit on purchase 25% tax on 659 goods produced in the USA has come into effort on 6 July. It is going to effect agricultural production, cars, and water production field. How will it affect Japanese business?
The Reasons for Taxes: Impediments and Misconceptions
In its turn, China has already accused the USA of unleashing of the most dangerous economic war ever as well as breaking the regulations of World Trade Organization. Moreover, China is not going to fail. It has harnessed powers and come up with hard-boiled measures towards the USA. Additionally, the Chinese government has warned American authorities to think about an economic war several months ago when the USA claimed to have started protection measures from goods in China. Another reason said for the protection measures from goods in China was because of a high level of trade shortage.
Friend or Foe?
First and foremost, there is sweeping generalization that seems quite evident. The longer the economic war between China and America is going to last, the bigger harm to the international economics will be made. Thus, it is not surprising that both China and the USA are in a crucial need of an alliance partner. In addition, the charm offensive to attract as many countries as possible to feel more confident testifies the fact that neither Beijing authorities nor Washington authorities going to de-escalate a conflict soon.
Japan became a tasty morsel in this economic war. Particularly, the negotiations have recently started between Beijing and Tokyo. As it has become known, Chinese partners have tried to win Japan by reminding Japan how Tokyo suffered because of American tariffs on the steel imported to America.
The more economic war between China and America is going to last, the bigger harm to the international economics will be made.
Definitely, Washington is not going to capitulate peacefully. Donald Trump has also initiated the negotiations with Prime Minister of Japan Shinzō Abe with the purpose to discuss further trade relations. However, Chinese authorities are convinced that imposition of taxes made the USA an unreliable partner in the eyes of other countries. Being accompanied with the growing economics of China, all these factors will push Japan into welcoming embrace of a stable Asian partner. In the meantime, we should make emphasis on the fact that Japan is competing with China in geopolitics and impact made on third world countries.
Concerning the USA, it also has something to offer. For instance, in December American authorities were supported by Japan in the application given to World Trade Organization. A wide range of economic glut in some areas of Chinese economics and theft of technologies by Chinese corporations were included there.
How is it connected with the offense of Japan on occasion of big taxes on steel? As it is stated by the former employee of International Monetary Fund, Japan has all the reasons to criticize USA. However, it will not do it because it hopes to be excluded from the announced tariffs on steel.
A brinkmanship diplomacy is a hard thing, isn’t it?
