US-China Tariff War: Inflation will increase tremendously!
The economic conflict between America and china is not a new issue. In the trade war that started in 2018, both the countries imposed heavy tariffs on each other's products from time to time. However, now this dispute has reached a new height, when the US increased the tariff on products imported from china by 125%.
The main purpose of the US to increase tariffs against china is to encourage domestic companies to manufacture and reduce dependence on Chinese goods. This move of trump will affect not only china but also the American consumer, because cheap goods imported from china will now become expensive. This can increase inflation in the American market.
What does America buy from China?
China is one of the largest exporting countries of America. A good supply of electronics, toys and consumer products in the American market comes from China. These mainly include electronics goods, including smartphones, computers, video games, lithium-ion batteries, etc.
In home decor and furniture, light fixtures, seats, mattresses are exported from china to the US. Talking about textiles, sweaters, clothes and shoes reach the US market in large numbers from China. china also exports other products including plastic goods, motor vehicle parts, party decorations, medical equipment, etc. Now, with the increase in tariffs, the price of these goods will increase in the US.
What does china import from the US?
China not only sells goods in the US market but also buys from them. china is a major buyer of American agricultural products and industrial machinery. The main goods going from the US to china include agricultural products, energy resources, industrial machinery, medicine, including scrap copper, acyclic hydrocarbons, ethylene polymers. If china retaliates on US exports in these areas, then American agriculture and tech companies may suffer huge losses.
click and follow Indiaherald WhatsApp channel