China's WTO Entry: Pressure to Go Beyond the Norm - Essay Sample

Introduction

One of the main points is that China because it wanted to join the WTO, was pressured mostly to meet requirements that went far beyond what usual WTO rules entail and what any other nation had to agree to participate. The Chinese needed the security that came with WTO membership the safety being, you can't just be hit with tariffs unilaterally (at least that's meant to be the case, but Donald Trump doesn't realize that. During the time before China entered when the U.S. and other countries didn't like what China was doing, for example, infringing intellectual property rights, those countries just told China that they were going to tap tariffs on them. China still tried to be in [the WTO], but the U.S. had them in a side alley to be brave enough to say unless you want to be in. You are going to have to commit to those very onerous conditions, not only of starting up the International market but promising to shield our economy from Chinese goods these were sacrifices that most other nations never had to create (Tsalikis, 2019). This paper will look at the impact of the trade ward between the United States U.S. and China on various global economies like Inequality, globalization, and the volume of world trade.

Tsalikis (2019), discusses that he Chinese, despite their century of humiliation beginning with the Opium Wars and continuing through the Japanese occupation and conquest, all the way to the 1949 Chinese Communist Revolution comprehensibly accepted that. And they just sighed profoundly and acknowledged needing to do this. I think the leadership, at some point, recognized why other member states were a little frightened of Chinese rivalry. At that time, the reasonable assumption is that China could develop into something more like what the province of Taiwan is today, a much freer, open-market form of economy.

The Global Trade War

According to Steinbock (539), The U.S. and China have struggled to reach consensus on a trade deal. Many tariffs are implemented. It announces new challenges to trade. The White House is intensifying threats, intellectual property rights, social and political questions, and security reform on the Chinese industry. Confusion grows, and there is increasing uncertainty. Sufficient US GDP growth has a significant impact as Chinese productivity erodes. Worldwide is starting to propagate the "Great Global Crisis 2.0." The economic outlook will overshadow economic GDP growth, which will plunge for years to come to 2-2.5 percent, boost worldwide trade and investment, and a host of new developments in the aftermath of the protracted global recession.

In reality, there were already opportunities for improvement and rehabilitation, and there is scope for more conflict as well as deterioration. The real condition was between the "muddling through" and "America First" Situations (Steinbock, 2016 p.538). It is important to note that global growth has already increased in contrast with prior 2008 peaks, and recent growth and trade patterns mirrored, even more, the regular periods of severe recessions and significant conflicts. The problem is what now that U.S. polls indicate that most People oppose tariff wars, making these trade wars inevitable. The solution may have a great deal to do with America's "imperial presidency" (Steinbock, 538).

Impact of U.S. And China Trade War on Globalization

According to Meidan (2019), a trade settlement between the world's two biggest economies may be inevitable as the U.S. national elections were approaching, and China completes its 13th five-year plan. But any such agreement is likely to stop a further increase of tariff tensions rather than resolve bilateral disputes in practice. In China, judgment-makers are planning for prolonged tensions with the U.S. and, though both sides claim not to try to 'decouple' relations, 2020 may perhaps unwittingly be the year that investors see the first glimpses of de-globalization.

Negotiations between the U.S. and China could provide short-term respite, and new tariff freezes. It will likely ease investor concerns regarding slower growth in demand and a potential recession a product of the trade war's effect on two of the world's largest economies. Beijing has often worried about reliance on oil. China is indeed the world's leading importer of crude oil, purchasing nearly 10mn Bl / d in 2019 more than two-thirds of its total oil requirements and the second-largest purchaser of LNG, expected to import more than 80bn m3/d in 2019 over 40pc of its aggregate gas demand. This threat spreads towards volatility in oil and gas producers, as illustrated in September 2019 by the attacks on the Saudi oil infrastructure in 2019 (Meidan, 2019).

Further, Davies (2019), affirms that the Chinese had agreed to take a stronger position in the talks, diminishing the chances of an agreement. I didn't change my opinion easily after being so confident for such a long time. In my view, a stalemate in trade negotiations will lead to tariff ramping and sluggish economic growth. However, in the times which followed, equity markets rallied. At least for the short term, I seemed to be incorrect. Yet little has improved so that to make me more hopeful. In early August, the announcement by President Trump of a new round of tariffs elevates my skepticism. Disheartened by seemingly unfruitful talks with China, he has boosted the stakes dramatically in a trade war that has been dragging on for some time.

Impact of U.S. And China Trade War on a Volume of World Trade

The current trade conflict between the U.S. and China has resulted in a steep decline in bilateral trade, higher prices for goods, and border diversion consequences (enhanced supplies from nations not involved directly in the trade war). By analyzing newly released trade statistics, the study finds that U.S. consumers bear the most onerous burden of U.S. tariff barriers on China, as their costs involved have been mainly pushed on to them and importation companies in the form of taxes. The study notes, however, that Chinese companies have recently started to offset some of the tariff costs by raising their export rates. (United Nations Conference on Trade and Development, 2019).

According to Chatzky (2019), tariffs have been used for a long time to promote indigenous businesses by having local citizens to purchase locally manufactured products. However, taxes also fell out of favor for much of the last century because they frequently contribute to reduced trade, higher costs for businesses in tariff-wielding nations, and international retribution. With tariffs increasing again under U.S. President Donald J. Trump and the decelerating of global trade, many experts have warned that businesses could face higher costs soon and that the world economy might suffer.

Further, Chatzky (2019), asserts that a tariff is a tax levied on goods from other countries that have been imported. Customs duties are paid to the government of its native land by a purchasing company, most usually as a set percentage of the products 'value. Tariffs may accomplish a variety of objectives. Like all taxation, they offer a small amount of public income. Many countries have also used tariffs to help their embryonic domestic industries to protect local companies from international rivals. Many duties often combat unfair policies used by other countries to make their products artificially cheap..

Tariffs are intended to protect domestic industries by trying to make products more expensive and continuing to drive local companies to the consumers. Many sectors in the United States are benefiting from these tariffs. Since 1789, sugar farmers have been covered by taxes, and since 1964 the car industry has helped from the so-called chicken levy, which imposes tariffs of 25 percent on particular pickup trucks. Nearly every nation imposes such tariffs. Exceptions include Hong Kong, which never imposes tariffs as a "free port." Wealthy nations typically retain low taxes as compared with developing countries. There are many explanations for this: developed countries may have more vulnerable businesses they wish to protect, or they may have less government income sources. For example, the United States retained high tariffs for several years, before income taxes substituted tariffs as the primary revenue source. Duties began to decline after World War II, as the United States underlined trade growth as a core pillar of its economic strategy (Chatzky, 2019).

Impact of U.S. And China Trade War on Inequality

Inequality and poverty have now become a cornerstone of the current economic era, and the phenomenon is experienced not only by U.S. citizens. The World Economic Forum has dubbed increasing inequality "one of the biggest challenges of our time." It cites the negative side of an increasing gap between rich and poor: weaker social media, rampant crime, and fragile democracies. The wealth disparity has been cited by the ratings firm S&P Global Ratings as a long-term phenomenon that challenges America's economic growth (Picchi, 2017).

According to Picchi (2017), although the wealthy have become wealthier, many Americans, particularly those of us who lack university degrees, have also been left behind. During the campaign, President Donald Trump promised to help to revitalize most of these workplace jobs and to simply point out what he believed were market and job disparities with other nations, such as China and Mexico. In counter this disparity, Mr. Trump raised the tariff opportunities for Chinese-made goods by increasing the prices of American consumers, which could decrease demand in Chinese-made products. It is essential to ask how the two countries are related economically, as they are on the verge of a trade war. According to a new paper from economists, including Thomas Piketty of the Econ School of Paris, the two countries are close in one way; since they have experienced Inequality in income since the 1970s.

According to Yueh (2018), in a series of steps announced by the Trump administration, a series of Chinese imports is guided by the imposition of U.S. tariffs - a levy on manufactured goods. To date, China's response has been to impose tariffs on U.S. imports. The next step is for the U.S. to restrict Chinese investment in America. If that happens, it is likely that China will respond well to it. In other words, tensions between the U.S. and China can go beyond taxes and could directly interfere with global supply chains as a targeted investment. Any production and distribution chain interruption that is a crucial element of world trade can have a lasting effect.

In the worst-case situation, businesses might have to switch plants or delivery centers. Decisions on spending have an impact on jobs and taxation that, in specific ways, are more disruptive than tariffs, and that can be overturned sooner. This escalation would affect the economies of the U.S. and China, as multinational corporations, like Apple, invests in both countries. Not only U.S. businesses, but American consumers would be impacted. Retailers like Walmart imported Chinese items in order to raise costs and increased living standards. (Yueh 2018). For both states, a lot is at stake.

Nevertheless, a trade war would not lead to better protection of U.S. technology or better access by American companies to Chinese markets. China, however, is not going to support spending in America. One persistent Chinese complaint is that its companies, especially in the technical field, are being blocked, which is vital to their economic growth. After implementing an initial round of tariffs on steel and aluminum, the U.S. and China decided to discuss means of opening up more extensive markets and creating a...