A trade war is pointless: The US and China need to talk

It would help if the Trump administration makes it clear whether it wants decoupling or a trade deal

- SUSAN THORNTON

The US and China are caught in a trade war that could gravely damage their economies and even threaten global stability. Since US President Donald Trump's declaration on 2 April of 'reciprocal' tariffs on almost all US trade partners, the two countries have imposed triple-digit duties on each other—levels that have effectively created a mutual trade embargo.

Container bookings from China to the US have already fallen by 60%, and orders for all kinds of Chinese products have been cancelled. When the effects of this slowdown hit the US, not only will consumers find it difficult to buy Chinese-made goods, so will many US businesses, which sell these imports or use them as inputs. Given that such items are not going to be produced in the US or sourced from other countries any time soon, many businesses will struggle.

The Trump administration has apparently realized the gravity of the impending crisis. On 22 April, Treasury Secretary Scott Bessent called the US-China trade war "unsustainable," and an unnamed source said that the White House would consider lowering tariffs on China. Other officials swiftly walked back these comments, saying that the US would not act "unilaterally."