China's Economy and Trade War with the U.S.



Ren Shimada| Mr. Roddy |IHSS |29 January 2019
China’s Economic Slowdown and Trade War with U.S.

Some recent news on one of the world’s biggest economies could have a global effect in the near future. China, who has the world’s second largest economy, has shown that their economy has been lagging behind in growth. With the numbers and statistics that we have, it is evident that the Chinese economy in 2018 was the most stagnant and slow progressing that it has been in about thirty years. Since China plays a huge role in the global market and economy, this could be bad news for everyone. If the numbers that have been shown are correct, economists at Oxford predict that this could bring the global economic growth down to 2.3% this year. However, many think that the declining data of China’s economy might’ve actually been worse since it is very unlikely that they could've already gotten all of the data from the last fiscal quarter of 2018 already. One of the factors for this change is the decreasing amount of factory activity which has been declining in the past two years and is continuing to get worse. Since the U.S. has a heavy dependence on Chinese manufacturers and its economy, this could directly affect the economy of the U.S. In addition, with the American economy already facing some issues, this could affect the global economic growth even more and hurt both China and the U.S. GDP.

This recent news really shows the domino effect that one country can have on the global economy. Since politicians in the U.S. increased trade tariffs and decreased imports to China in 2018, this added to some of the economic slowdowns in both countries. Without some of our imports such as aircraft and agriculture like soybeans, China now has to rely on other ways to obtain these things. Although, situations like this are useful for learning about how the world’s economy is structured. It also shows that even the world’s largest economies can depend on each others success. Even though attempting to decrease the U.S. dependence on China’s imports and exports could give the U.S. independence from the Chinese economy, it could hurt both the global economy and ours in the long run since many other countries depend on China’s exports and economy. Basically, this situation could come back and bite us in the back since the global economy is so intertwined. One thing that I wondered is how far ahead economists look and what they take into account when dealing with macro-economics since the effects might not be immediately obvious.



https://markets.businessinsider.com/news/stocks/china-slowing-could-drag-world-economy-down-with-it-2019-1-1027906201

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