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Is the Hong Kong Unrest Worsening the US-China Trade War? 5 Geopolitical Effects You Need to Know

1. China threatens retaliation to the US linking Hong Kong to trade talks

The developing unrest in Hong Kong and tensions with China, has appeared to cause a worsening state of the US-China trade war. China has promised to retaliate against the United States if Washington imposes additional tariffs on its products on September 1. A brief statement released by the State Council’s customs tariff commission on Thursday said China would have no alternative but to take countermeasures. It said the threat to impose 10 per cent tariffs on US$300 billion of Chinese imports which appeared to link the outlook for trade talks with China to a resolution of the Hong Kong protests, ran against the consensus reached by US President Donald Trump and his Chinese counterpart Xi Jinping when they met in Japan in late June. Trump’s move has therefore only worsened the situation and distanced the possibility of an end to the trade war.

2. Trump’s arrogance rules out sights of end to trade war

It appears US President Donald Trump does not want to hear China’s side of the story, as said that the US-China trade deal has to be a deal on their terms. Meanwhile, the 10-year US Treasury bond yield, which slumped to its lowest level since September 2016 by losing nearly 4%, is now up 0.1% on the day. It is most probable that those terms will be beneficial to the US and not to China, hence China not accepting them, and the trade war raging on. Trump will have to compromise if we are to see any end to this trade war.

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3. Trade war damaging the US economy

4. Overall damage of trade war

5. China provides light in tunnel

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