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HKTDC outlines a shippers' guide on how to survive and thrive through a Sino-US trade war
With the US ramping up trade tensions not just with mainland China, but also with many allies, the export environment has seldom seemed so formidable, says the Hong Kong Trade Development Council.
But there are customs strategies, international regulations and export options that should help shippers to ride out the storm, says the HKTDC. After imposing Section 232 tariffs of 25 per cent and 10 per cent on imports of steel and aluminum products, the US published two lists of goods produced in China that could be affected.
This followed a Section 301 investigation which ruled that China acts in ways that are unreasonable and discriminatory. Beijing reacted to the steel/ aluminium tariff increase by unveiling a list of 128 US products that now face higher duties of 15 per cent or 25 per cent.
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Cheered yet feared, China's Belt and Road initiatiative continues to encircle half the world
At first dimly and now more clearly, China's "string of pearls" policy begins to shine in the darkness. Some pearls have been visible - and worryingly so - for some time, like the seizure of the Spratly Islands in the South China Sea, athwart the Asia-Europe trade lane, and keenly disputed by Vietnam and the Philippines and condemned by the world court in the Hague.
Also becoming increasingly visible is the rail route from China to Poland, now running as far as Spain. Other rail routes through Malaysia and still others reaching into Iran. More prosaic and incremental has been growing port investments at Colombo along the Asia-Europe sea route, and again at Gwadar in Pakistan, Piraeus in Greece and a Chinese funded railway in East Africa from Mombasa to Nairobi.
One could be forgiven thinking this arrangement had a striking resemblance to the development of the British Empire with the Royal Navy protecting the route from India - which is how Sinophobic strategic analysts are inclined to view it.
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How will the world create an agricultural trading system that is fair to China - and everyone else?
Agriculture is where international trade disputes fester the most because the sector encompasses the poorest yet the most politically volatile constituencies - especially now that an ever more prosperous world is making greater and greater demands for food as prices rise.
Time was when farmers, except for the richest, were far down on the economic and social scale. Time was when food was a plentiful renewable resource the world over. But times have changed. Ratios between rural and urban dwellers have reversed themselves in the developed world since 1970 and pretty much everywhere else since.
But while times have changed in some respects, they have not in others. In the developed world, far greater political representation was given to the least populous agricultural regions, partly because they were the most populous at one time - most glaringly in the US Senate where Wyoming (pop 600,000) is entitled to the same two senators as California (pop 40,000,000).
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In trade war, the object is to have one's opponent to see it your way and make a deal
In our binary world, divided between right and left, rigid and flexible, hawk and dove, this division exists everywhere most of the time except in the rarest of circumstances. So it is hard to know what's right thing to do because the time and place and so often dictates the best course to take.
In the Sino-American trade war, these two forces are again arrayed against each other. Taking the view of the American intelligentsia which perpetually resides on the left, the view is predictably dovish - a view typified by Cheng Li and Diana Liang, scholars of the politically liberal Brookings Institution in Washington.
While not openly hostile to US President Donald Trump, the Brookings scholars repeat the media refrain that a trade wars hurt everyone. Indeed, that applies to all wars, but it does not make some any less necessary or worth fighting. And whatever troubles they bring their final resolution if there is one, often brings lasting peace.
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