The US can't win a trade war all on its own

Products at a steel market in Shenyang in China's north-eastern Liaoning province. China is already the world's biggest market for products such as cars and smartphones, and its middle-class consumers are well on their way to supplanting US household
Products at a steel market in Shenyang in China's north-eastern Liaoning province. China is already the world's biggest market for products such as cars and smartphones, and its middle-class consumers are well on their way to supplanting US households as the world's most important shoppers, says the writer.PHOTO: AGENCE FRANCE-PRESSE

As United States President Donald Trump prepares a wide-ranging package of tariffs and investment restrictions targeted at China, a trade war between the world's two most important economies looks unavoidable.

On the face of it, the US might seem to have the leverage it needs to win. Since it runs a huge trade deficit with China, the Chinese have a lot more to lose.

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A version of this article appeared in the print edition of The Straits Times on March 23, 2018, with the headline 'The US can't win a trade war all on its own'. Print Edition | Subscribe