Looking Before Leaping: Can We Afford an Unlimited Trade War Between the World’s Two Largest Economies

Abstract

The Trump administration launched the world’s biggest trade war with China, which is suggestive of its distinctive governing philosophy. Consequently, the trade war with China is not only part of the US policies on China, but also part of the Indo-Pacific strategy of the administration, with aims of both money and containment. In response, China has adopted both hardline and moderate approaches, resolutely fighting back the pressure from the USA and exhibiting restraint in retaliation. However, China and the USA have their own advantages, and the end of the trade war depends on the resolution, willpower, and judgment of the situation. Presently, China is the only country that has the ability and resolution to stand up to the USA to stay the course in the trade war; China’s perseverance and retaliation to the US’ extreme pressure in the trade war temporarily eased the pressure on other countries from the USA. The trade war is damaging to the world and will cause more harm if it goes unchecked. The USA dominates the direction of Sino-US relations, but China’s response also shapes Sino-US relations to a certain extent.