20°C / 22°C
  • Sat
  • 30°C
  • 16°C
  • Sun
  • 27°C
  • 16°C
  • Mon
  • 31°C
  • 16°C
  • Tue
  • 31°C
  • 16°C
  • Wed
  • 31°C
  • 16°C
  • Thu
  • 30°C
  • 16°C
  • Sat
  • 22°C
  • 15°C
  • Sun
  • 24°C
  • 16°C
  • Mon
  • 27°C
  • 16°C
  • Tue
  • 30°C
  • 17°C
  • Wed
  • 22°C
  • 17°C
  • Thu
  • 22°C
  • 16°C
  • Sat
  • 32°C
  • 17°C
  • Sun
  • 30°C
  • 17°C
  • Mon
  • 33°C
  • 18°C
  • Tue
  • 33°C
  • 18°C
  • Wed
  • 34°C
  • 19°C
  • Thu
  • 34°C
  • 19°C
  • Sat
  • 32°C
  • 17°C
  • Sun
  • 31°C
  • 18°C
  • Mon
  • 33°C
  • 17°C
  • Tue
  • 33°C
  • 18°C
  • Wed
  • 31°C
  • 16°C
  • Thu
  • 32°C
  • 16°C
  • Sat
  • 26°C
  • 20°C
  • Sun
  • 27°C
  • 22°C
  • Mon
  • 27°C
  • 22°C
  • Tue
  • 29°C
  • 23°C
  • Wed
  • 29°C
  • 23°C
  • Thu
  • 27°C
  • 23°C
  • Sat
  • 22°C
  • 16°C
  • Sun
  • 22°C
  • 18°C
  • Mon
  • 22°C
  • 17°C
  • Tue
  • 23°C
  • 19°C
  • Wed
  • 25°C
  • 18°C
  • Thu
  • 23°C
  • 17°C
  • Sat
  • 26°C
  • 11°C
  • Sun
  • 28°C
  • 12°C
  • Mon
  • 34°C
  • 14°C
  • Tue
  • 36°C
  • 18°C
  • Wed
  • 25°C
  • 15°C
  • Thu
  • 23°C
  • 14°C
  • Sat
  • 21°C
  • 13°C
  • Sun
  • 23°C
  • 14°C
  • Mon
  • 28°C
  • 15°C
  • Tue
  • 28°C
  • 17°C
  • Wed
  • 21°C
  • 16°C
  • Thu
  • 21°C
  • 15°C
  • Sat
  • 35°C
  • 19°C
  • Sun
  • 35°C
  • 19°C
  • Mon
  • 36°C
  • 19°C
  • Tue
  • 36°C
  • 20°C
  • Wed
  • 35°C
  • 20°C
  • Thu
  • 37°C
  • 20°C
  • Sat
  • 35°C
  • 15°C
  • Sun
  • 35°C
  • 20°C
  • Mon
  • 36°C
  • 18°C
  • Tue
  • 34°C
  • 20°C
  • Wed
  • 34°C
  • 21°C
  • Thu
  • 36°C
  • 21°C
  • Sat
  • 29°C
  • 18°C
  • Sun
  • 32°C
  • 17°C
  • Mon
  • 29°C
  • 18°C
  • Tue
  • 33°C
  • 18°C
  • Wed
  • 35°C
  • 17°C
  • Thu
  • 36°C
  • 18°C
  • Sat
  • 21°C
  • 14°C
  • Sun
  • 21°C
  • 15°C
  • Mon
  • 23°C
  • 15°C
  • Tue
  • 25°C
  • 18°C
  • Wed
  • 24°C
  • 17°C
  • Thu
  • 23°C
  • 16°C

Don’t understand the US-China trade war? This metaphor could help

The deadlock between the US and China is a hugely complicated issue, with dizzying amounts of money at stake. Can a sporting analogy help break it down?

FILE: China's President Xi Jinping (L) and US President Donald Trump attend a welcome ceremony at the Great Hall of the People in Beijing on 9 November 2017. Picture: AFP

US President Donald Trump has slapped 10% tariffs on about $200 billion worth of Chinese imports, intensifying a trade war that has sent shockwaves through the global economy.

“Unfair policies and practices”, such as the theft of US companies’ intellectual property are to blame for the escalation, Trump said in a statement, and despite recent talks aimed at breaking the deadlock between the two sides, neither seems in a rush to back down.

It’s a hugely complicated issue, with dizzying amounts of money at stake (in 2017, trade between the two countries totalled $636 billion). In one session at the Annual Meeting of the New Champions in Tianjin, Covington & Burling’s managing partner, Timothy P Stratford, resorted to a sporting metaphor to break it down.

“The analogy I use is football,” he said. “One team shows up on one side of the field; they are the World Cup champions. And on the other side of the field, you have the Superbowl champions.

“They’re both there to play football but they have very different ideas ... each team plays a very good game but the rules they play are designed to showcase different skill sets.

“The World Cup football team is very agile, they move very quickly, they adjust rapidly. The American football team is more deliberate - every play is planned, every player on the field has a coordinated role, they wear protective gear.

“Basically, the US and Chinese economies are like these two teams, playing on the same field.”

WATCH: Beyond Tariffs - Stratford - confusion with the rules of the game

SO, WHICH ONE IS WHICH?

It’s an American game, of course. But in this analogy, it’s the Chinese economy that is playing the US style of football.

“The US side, by putting down tariffs, is trying to pressurise the Chinese government to change and play its style of football,” Stratford said. “The US government wants China to move more in a market-oriented development model, and the Chinese government believes that what they are doing now is in their own best interests.

“In fact, they are concerned that perhaps US motivation is to keep China down, wanting to suppress their growth and to contain China.”

IS THERE AN END IN SIGHT?

“You have a very big gap between the Chinese side and the US side,” Stratford added. “I expect there will be a deadlock for quite some time.

“The US view is that China has embarked on a path where they have state-led economic development in many key sectors of the economy and this is against the fundamental, underlying assumptions of the WTO [World Trade Organization] and that therefore this is causing harm...

“The fall back from some people in the United States is that the Chinese economic system is putting harm on the US economy and US companies, the next best thing to agreeing to solve the problem is to have a gradual decoupling, and all you have to do is threaten tariffs and threaten investment restrictions and already companies have to factor this into their plans.”

Written by Ross Chainey, Digital Media Specialist, World Economic Forum.

This article was republished courtesy of the World Economic Forum.

Comments

EWN welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

- Racism (including offensive comments based on ethnicity and nationality)
- Sexism
- Homophobia
- Religious intolerance
- Cyber bullying
- Hate speech
- Derogatory language
- Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the EWN community a safe and welcoming space for all.

EWN reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

EWN is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

comments powered by Disqus