By Dan Nguyen
There has been a raging war that the United States has been caught in for quite some time.
This battle might not have created any casualties, aside from a few aching wallets from high tariffs.
Through arguments and predicaments, a major deal was struck between two of the largest countries in the world, ending the China and American trade war.
Although this deal has great implications, there’s still unknown consequences for both countries.
On Jan. 15 the U.S. and China signed a trade deal that is set to take effect on Feb. 14.
According to the South China Morning Post, the trade deal lays down an agreement that China must boost its purchases of U.S. manufactured goods, agricultural products, energy and services over the course of two years.
Chinese Vice-Premier Han Zheng told the World Economic Forum that the trade deal between China and U.S. will not have any impact on rival exporting nations.
Although this deal is meant to benefit both countries, I can see the pros and cons for each country economically.
In an article by South China Morning Post, Chad Bown of Peterson Institute for International Economics of Washington, said that this deal could divert rather than expand the growing international commerce.
China imports from the U.S. could come at the expense of other European countries since, according to Bown, if China chooses to purchase soybeans or other dairy products from America, then there wouldn’t be any point to them trading or dealing with European countries.
From the same article, President Donald Trump said that this deal could be a boon for farmers since they were hit the hardest during the trade war.
China is easing on their regulations regarding licenses, inspection and registration rules which the U.S. has viewed as a barrier for the country.
With all that said, this deal seems like a major win for not only the United States, but for China as well.
Trump is trying to stop China from outsourcing and stamp out theft of intellectual property.
A lot of intellectual property is bought through foreign investment and Trump blames China for stealing Western trade secrets.
China has been using subtle tactics in order to access Western technology, to which China forms joint ventures with local firms in order to do business.
Apple and Amazon have set up ventures with local partners in order to handle data in China and to comply with security laws.
The trade deal can help Western tech companies look out for any third parties trying to steal data or confidential information.
A lot of companies are scared of accusing China of internet protocol theft for fear of getting punished financially.
It’s pretty scary to know that China can go through all the trouble of getting information, especially from Western technology.
With China doing this in the trade deal, they most likely can’t use the subtle tactics that they have used before to obtain information.
This deal is an amazing start in the right direction, but in the end China has not held up to deals in the past so it might not exactly be the time for Americans to celebrate.
