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Ashburn

China dealt a crushing blow in the global economic war

It is very likely that the US President will have to escape from the burning American cities and belligerent statements against the rioters that swept America. The fact that the authorities in Beijing, according to media reports, decided to take this opportunity to remind you that at the front of the trade war between the US and China were only uneasy truce, and not a full peace, and that at the most inopportune Donald trump moment the war might break out with renewed vigor.

Bloomberg and many Asian media including Hong Kong's South China Morning Post reported that Chinese state companies allegedly ordered to suspend imports of U.S. agricultural products.

For trump it is an important political question, which is, as the foreign and domestic component. First, farmers and residents in agricultural States is vigorous electorate of the incumbent President, and the fall in the US presidential election. He must not be in status of policy, which deceived the expectations of its most loyal voter, the more that other economic, epidemiological and racial problems now abound, and the failure of promised export supply and related financial income is a political and PR nightmare.

An even more important political consideration is the fact that the very "deal for the first phase" was the main and the only success of the Republican administration on the Chinese front. The American business community, as well as part of the expert community follow the old and rather pragmatic principles in the analysis of the success of specific foreign policy steps, in the sense that they have little interest in the billions, tens of billions or hundreds of billions of dollars of alleged damage suffered by American opponents, because they are primarily concerned with how American companies or the U.S. Treasury will be able to make money. Can you explain this logic on a concrete example: the number of destroyed Iraqi tanks in this picture of the world is of no interest compared to the number of oil barrels on the captured fields. And in this sense, the President of trump was of enormous complexity — a trade war with China, involving the rates and penalties inflicted, and inflicts economic damage to China, as well as some economic damage to American business, but with the additional profit of the question is very ambiguous.

"Deal for the first phase" have enabled the American President to show the business and those opposed to a hard gap of economic ties with China, regardless of the accompanying negative effects on the level of principle "trompowsky method" (i.e., threats, blackmail, tariffs, negotiations, flattery, then again blackmail, and so on) still works. Critics of the "deal" was rightly pointed out that China is actually conceded almost nothing and just agreed to buy in the United States that it was purchased on world markets, that is, by and large trump, when increased purchases of U.S. soybeans, "victory" is not Beijing (regardless of what say his supporters) and hit on Brazilian exporters of soybeans — and nothing more. But from the point of view of a purely accounting — the position of President of the United States was a good one: to "trade war" China bought less after the start of a "trade war" began to buy more and thus (for typical American logic), the President, who have increased profits — well done and a good strategist. Beijing is now flick of the wrist removes the head of trump virtual Laurel wreath, which he was awarded as the best Manager in the export of U.S. soybeans and other agricultural products, and throws the wreath into the trash.

This is done informally, but with the perspective of the global media, this show of force has already taken place.

South China Morning Post highlights: "State traders Cofco and Sinograin was ordered to suspend purchase, according to one source, who asked not to call them names because they're discussing a private matter. According to one source, the Chinese buyers also cancelled for an indefinite number of orders of pork in the United States. According to another source, the private companies were ordered to stop the import.

The foreign policy message of this action is obvious. Trump has shown that if States are going to "punish" China for its suppression of separatism in Hong Kong, China to get started, simply defiantly destroy the main foreign policy achievement of the President, and if necessary it can be done right before the election to cause maximum political damage. It is possible that other partners of China will take such action with understanding: the deal is still expected, at least from the point of view of basic common sense, some restraint in the use of economic and financial levers of pressure on Beijing. But the President himself, as well as representatives of both U.S. parties are now clearly going to impose sanctions against Hong Kong, to set tariffs on Hong Kong re-exports of Chinese goods to the United States to achieve delisting of Chinese companies from American stock exchanges and even the use of "targeted" sanctions against Chinese financial institutions.

If the sum of all the factors, it turns out that China is actually showing incredible restraint and suspension of the import is kind of a warning shot in the air. However, the chances that it will stop trump, virtually no. We can say that the trade truce between Washington and Beijing was doomed to failure, but it is a pity that this breakdown can occur at a very inopportune moment for the world economy as a whole. We still live in a globalized world, and a trade war between the US and China will affect the economies of all countries that have at least some relation to global markets.