Trump’s tariff moves against China to benefit India? In the current climate of US-China trade disputes, a Jefferies analysis suggests that countries such as India and Japan could potentially secure more advantageous trade arrangements with the United States.
The analysis indicates that whilst India and Japan might secure improved trade terms with the US in the present circumstances, they would likely avoid any agreements that could potentially damage their existing commercial relationships with China.
Jefferies stated, “Japan and India may be able to negotiate better deals with the US than might otherwise have been the case, they are unlikely to agree terms that threaten their trading relationship with China”.
The analysis further points out that China has recently issued a stern caution, indicating its readiness to take retaliatory measures against any nation entering into US trade agreements that could compromise Chinese interests. This stance demonstrates China’s firm position in addressing its escalating trade frictions with the United States.
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The current US administration’s efforts to contain China through enhanced trade partnerships with nations like Japan and India appear to have limited effectiveness.
Analysis suggests this approach faces challenges, given China’s dominant position in global trade networks with numerous nations.
The findings state “for many countries China is now a more important trade partner than the US”.
Statistical evidence demonstrates China’s commanding position in international commerce. IMF figures reveal that by 2024, 143 nations, constituting approximately 71 per cent, will conduct more trade with China compared to the US.
The data further indicates that 107 countries, roughly 53 per cent, engage in trade volumes with China that exceed US trade by more than twofold. These figures represent a substantial increase from 2001, when China entered the World Trade Organization, with corresponding percentages at 22 per cent and 11 per cent.
This transformation illustrates China’s emergence as a predominant force in global commerce, complicating US attempts at economic isolation. Nevertheless, the situation presents potential advantages for India and Japan in the current trade environment.
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