The US-China trade war: Economics rivalry and global implications

Abstract

This paper discusses the US-China trade war as one of the conspicuous events of economic and geopolitical conflict of the 21^st century, its causation, dynamics and the implications it has had across the world. Although the trade war began as a bilateral dispute in the context of trade imbalances, intellectual property rights and access to markets, it quickly turned into a strategic conflict of two competing paradigms of political economy. This paper places the trade war in the context of power transition and the hegemonic competition using the prism of economic nationalism, realism and global political economy theories. It examines the major stages of the trade war such as the escalation of tariffs, the counter-actions and movement of global supply chains in addition to studying its consequences on the international trading standards and multilateral organizations like the World Trade Organization (WTO). Strategic hedging has been sought by many international institutions, diversification of economic relations and an acceleration of the process of regional integration by trade agreements like the Regional Comprehensive Economic Partnership (RCEP) and the African Continental Free Trade Area (AfCFTA). The paper claims that the US-China trade war is not only the bilateral dispute but the indicator of a more fundamental structural change in favor of a multipolar world in which both cooperation, adaptation and resilience will be the keys to stability and shared prosperity in the future.