The last salvo of US President Donald Trump, who is perhaps the main enemy of the Middle Kingdom in the United States, in the trade war with the Chinese was an attempt to ban downloads of the Chinese messenger WeChat and the TikTok application in the United States. For almost four years now, the American leader has been introducing astronomical tariffs on Chinese goods and all sorts of bans and restrictions on Chinese companies. However, according to the Bloomberg agency, on almost all fronts and directions, the Chinese are outplaying competitors from overseas.
One of the main indicators of success or failure in trading is the trade balance. Despite all the efforts of Donald Trump from the first day of his stay in the White House, the US trade deficit in trade with the PRC during his presidency grew by almost 25% and exceeded $300 billion on an annualized basis. Trump presents as his personal victory the document signed at the beginning of the year on the first phase of the trade agreement between China and the United States. However, Beijing is very far from fulfilling its obligations to increase imports from America. So America's victory on this front, as well as on many others, remains largely on paper and in words.
Take GDP, for example. China is the only one out of 48 countries that released data on GDP for the second quarter of 2020, in which it turned out to be higher than of July 1 than at the end of 2019. In the United States, for example, in the second quarter, the economy recorded a decline of 9, 5%, which is 32.9% on an annualized basis and is the largest decline since at least the forties of the last century.
The yuan is very active now, which has been strengthening for eight weeks in a row. This, by the way, is the longest period of strengthening the Chinese currency since February 2018. The dollar, in contrast to the Chinese currency, has been weakening lately. Meanwhile, funds are pumping funds into countries that offer good interest rates.
Behind this digital, in general, still outside lies deeper and deeper trends in the industry, which, according to Bloomberg, are also in favor of China and help it expand its presence in world markets after the abolition of quarantines.
China is now increasingly supplying them with very sophisticated engineering products, which until recently was dominated by Germany.
вЂњIt is a matter of time before Chinese companies come to the fore, according to Ulrich Ackerman, director of foreign trade at the VDMA Mechanical Engineering Industry Association.вЂќ
As for Trump's bans on WeChat and TikTok, they are ineffective, according to Bloomberg, because there are more effective and efficient ways to mitigate the threat that Chinese IT companies pose to the personal data of Americans. In any case, the White House attacks on high-tech Chinese companies will only slow down, but will not stop Beijing's attempts to dominate the global economy of the 21st century.
A prime example is a race to develop batteries, a major component in transportation, defense, and other sectors of the 21st-century economy. By 2025, China will have battery factories with a maximum annual capacity of 1.1 TWh, nearly double that of all other countries combined. Meanwhile, the White House, at least for the time being, is showing strange apathy in this matter.
So far, the cumulative result of all Donald Trump's efforts to вЂњseparateвЂќ the American and Chinese economies is that they only push China towards self-sufficiency. Obviously, the plenum of the Central Committee of the CPC, which is to be held in October, will be devoted to the elaboration of a five-year plan, in the center of which will lie precisely the achievement of this self-sufficiency.
In the Celestial Empire, this new economic strategy is called вЂњdouble circulationвЂќ, which is a hint at the external and internal drivers of the development of the Chinese economy. However, in other countries, it is called import substitution.
By the way, if Joe Biden comes to power, there will hardly be any serious changes for the better in relations between the United States and China, Bloomberg believes because the main task and goal of Beijing are to become the main world economy.
According to Robert Zoellick, a former US Trade Representative and ex-head of the World Bank, Biden should remember if he wins the November elections that foreign policy must start at home. He believes that the government should pay more attention to issues such as public health, migration policy, and inclusive economic growth.