News Analysis
The term ‘decoupling’ gained significance in 2019. On the surface, it’s used to describe the reduction of interdependence between China and the United States in global trade and commerce.
President Donald Trump placed tariffs on Chinese goods to address a number of longstanding grievances against Beijing: currency manipulation, forced technology transfers, domestic subsidies, and cyber espionage against U.S. businesses, to name just a few. China has stepped up its domestic technology research, aiming to decrease reliance on U.S. technology and project global leadership in a few emerging fields such as blockchain, 5G wireless, and artificial intelligence.
But decoupling also aptly describes a different trend—that the United States and China’s respective economies are undergoing changes differently. The U.S. economy, by all accounts, is booming. Even CNN’s public poll (conducted by SSRS) finds that 76 percent of respondents believe the U.S. economy is either very good or somewhat good, the best rating in 20 years.
China’s economic situation is different.
“The downward pressure on the economy has increased,” the state media Xinhua News stated earlier this month. China is experiencing its slowest economic growth in decades, and that pressure has partially fueled the need to come to a trade agreement quickly. Beijing is expected to strategically stimulate the economy as China braces for sub-6 percent nominal GDP growth going forward.
Five major storylines have shaped the Chinese business and economic environment during 2019. All of them will be major factors going into next year.
Phase One Trade Deal Reached
The United States and China reached a deal to de-escalate the ongoing trade war in December.
Support the originator by clicking the read the rest link below.
