The US-China Trade War: Who Conceded First And Why?

Henrik Larsen

4 min read

Post on May 15, 2025

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Early Stages of the US-China Trade War: Setting the Stage

The US-China trade war didn't erupt overnight. Years of simmering tensions over issues such as intellectual property theft, persistent trade deficits, and accusations of unfair trade practices fueled the conflict. The Trump administration, focusing on protectionist policies, initiated the escalation.

• Trump administration's imposition of tariffs on steel and aluminum: These initial tariffs, ostensibly aimed at national security, were seen by China as a pretext for broader trade actions.
• China's retaliatory tariffs on various US goods: China responded swiftly with its own tariffs targeting key US agricultural exports and manufactured goods, escalating the trade conflict.
• Escalation of tariffs throughout 2018 and 2019: A tit-for-tat exchange of tariffs marked this period, expanding the range of affected goods and further straining bilateral relations. This period saw significant economic uncertainty.
• Impact on global markets and supply chains: The US-China trade war didn't exist in a vacuum. The escalating tariffs disrupted global supply chains, increased prices for consumers worldwide, and negatively impacted global economic growth. Businesses faced increased costs and uncertainty.

Analyzing the Compromises: A Gradual Process

Attributing "concessions" to either side requires a nuanced understanding of the events. Instead of focusing on who "conceded," it's more accurate to examine the various compromises and adjustments made by both nations throughout the trade war.

• China's purchase commitments in the "Phase One" trade deal: This agreement involved significant commitments from China to purchase a certain amount of US goods, particularly agricultural products.
• US temporary suspension or reduction of some tariffs: The US, in return, temporarily suspended or reduced some tariffs on Chinese goods, signifying a degree of flexibility in its trade policy.
• Shifting negotiation tactics and rhetoric from both sides: The tone and approach of both countries shifted over time. Periods of intense rhetoric were interspersed with periods of more conciliatory statements.
• Economic impacts of the compromises on both countries: The economic consequences of these adjustments were complex and varied. Both nations experienced some economic pain and some economic gains, depending on the sector and the specific timing.

The Role of Domestic Politics in Shaping Trade Policy

Domestic political considerations played a crucial role in shaping the decisions and actions of both the US and Chinese governments during the trade war.

• US concerns about jobs and manufacturing: The Trump administration used the trade war to address concerns about job losses in the US manufacturing sector.
• China's focus on economic growth and technological independence: China’s actions were partly driven by a desire to protect its own economic growth and achieve greater technological independence.
• Political pressures influencing negotiation strategies: Domestic political pressures in both countries heavily influenced the negotiation strategies and the willingness to compromise.
• Impact of elections and public opinion: Election cycles and public opinion significantly impacted the political discourse and the pressure on both governments to either escalate or de-escalate the trade war.

Economic Consequences and Long-Term Impacts of the US-China Trade War

The US-China trade war had far-reaching economic consequences, extending beyond the immediate impacts on the two countries involved.

• Impact on consumer prices: Tariffs contributed to increased prices for various goods and services in both countries.
• Disruptions to global supply chains: The trade war caused significant disruptions to global supply chains, leading to production delays and increased costs for businesses worldwide.
• Investment uncertainty and its effects: The protracted conflict created uncertainty for businesses considering investments in either country, affecting long-term economic growth.
• Long-term consequences for bilateral relations: The US-China trade war significantly damaged bilateral relations and contributed to an overall climate of increased geopolitical tension between the two nations.

Conclusion

Determining who "conceded first" in the US-China Trade War is an oversimplification. Both sides made adjustments and compromises in response to complex economic and political pressures. The conflict highlights the significant role of domestic politics in shaping international trade policy and the long-lasting consequences for global trade relations. The US-China trade war serves as a stark reminder of the interconnectedness of the global economy and the multifaceted nature of international trade disputes. To fully understand the nuances of this complex economic conflict and its ongoing implications, further research into the US-China Trade War is essential. Dive deeper into the available resources and continue to follow developments in US-China trade relations to better grasp the future of global commerce.