As the world tries to sort out the economic impact of COVID-19, it is fair to wonder how this will affect US/China Trade Relations.
The tariffs rolled out in early 2018 by the Trump Administration caused much uncertainty and volatility and caused some companies to move supply chains from China to other countries. Some companies were beginning to move back to the US just as we hit the Coronavirus outbreak. The Phase 1 deal, signed on January 15,2020, softened relations and seemed to lay the groundwork for a more dovish/less hawkish relationship at least as we headed into the Election Season.
Since then, with global markets thrown into chaos via COVID-19, there is a multi-faced approach to US/China relations. On the one hand, Trump has shown persistent inclinations to maintain that softer approach with Premier Xi and the Chinese (see his multiple Tweets supporting Chinese corona-battling measures). On the other, political rhetoric from the Administration (and others) has been increasingly negative with regard to the actions of the Chinese government in response to the Outbreak.
Unsurprisingly, with global market volatility remaining high and uncertainty reigning, it is too soon to tell how the US/China long-term relationship will shake out. Both countries remain economically incentivized to improve relations, even as both compete for a larger share of global markets and more incendiary language becomes more common in our day-to-day as political actors attempt to (perhaps justifiably) lay blame elsewhere. We will keep a close eye on all of the developments between the two economic powers that will follow.
More to come!