Followed by the founding of the People’s Republic of China, USA and China have a long period of estrangement. The relation between US and China is very strong yet complex. The relations here refer to the international relations between both the countries. There are a huge amount of trade between both the countries make it somewhat political positive relations, yet some significant issues exist. The relation between the two has been described as the world’s most important bilateral relationship of the century by the world leaders. The countries are neither friends nor foes. The United States and China are clearly not allies. The United States has sought to build positive, comprehensive and cooperative relations with China by expanding their areas of cooperation and also mutually agreeing to the areas of disagreement. There are four annual dialogues held between the United States and China; the Diplomatic and Security Dialogue, the Comprehensive Economic Dialogue, the Law Enforcement and cybersecurity Dialogue, and the Social and Cultural Issues Dialogue which serves as a unique platform to promote bilateral understanding, discuss differences, expand consensus, increase cooperation, and build mutual trust between the two. The United States has put great emphasis on the need for both countries to enhance bilateral trust through formal dialogues, high-level exchanges, and expansion of people ties to ties. The United States approach to its economic relations with China has two major elements which are integrating China into the global, rules-based trading and economic system and also expanding United States exporters' and investors' access to the Chinese market.
Recently Trump has directed the US trade representative to level tariffs about $50 billion worth Chinese imports. The mainstream media has been full of these scenarios past few weeks concerning about the potential for a China-US trade war, given that the tariff impositions by United States President Donald Trump imposed upon China in order to stop steel dumping and to protect the American jobs. Trump has increased the tariffs on Chinese imports in order to pressurize China to reduce its tariff rates, regardless of the number of products provided by China to the United States of America where the profit margin is set by United States of America itself. In addition, Trump has also planned to impose new investment restrictions to take strict actions against China at the World Trade Organisation. The move, on the steel and aluminum tariffs also took aim at China, which is heightening concerns of a global trade war that could destabilize the global economy. The US is planning to continue to engage diplomatically with China to reduce the trade imbalance between both countries. It is said that the tariffs would focus on the theft of US technologies. The investigation concluded that China has stolen United States companies into turning over their intellectual property through a series of state-run structural maneuvers, which includes its requirement for foreign companies partners with Chinese companies to access the Chinese market. The investigation has claimed that China has stolen US intellectual property by hacking US computer networks. According to the United States of America’s International Trade Commission, the current average tariff on imports from China is about 3 percent. Low production costs in Latin America and Asia bring cheap goods in the United States of America, but tariffs would increase the cost of selling Chinese-made goods into the U.S. — which in fact appears to be Trump's goal. Administration officials have expressed concerns about China’s growing ambitions in industries like semiconductors, telecommunications equipment, and other high-tech exports. The tariff rates imposed by China has been measured and it was found out that it has been hit back at exactly the same voters that Trump is eagerly protesting. China has in fact taken a measured response to hurt Trump’s political base rather than swinging an ax over 1300 different products. China's Commerce Ministry on Friday urged the US to avoid placing bilateral trade ties in danger and also said they were not afraid of a trade war. Beijing's measures suspending tariff concessions will target 128 US products including pork, wines and seamless steel tubes and a 25-percent tariff on pork and recycled aluminum products. The Trump administration’s tax proposal, which is said to include cutting the corporate tax rate to 15 percent and also providing a one-time repatriation tax rate for trillions of dollars in the international earnings stashed overseas, is aiming at luring USA’s firms to remit overseas profits home and also to bring such operations back to the United States itself. The tax changes by the United States including the tariffs imposed on imports would tempt the Chinese manufacturers to now invest mostly in the United States of America and to sabotage the competitiveness of Chinese exports. The moto is for China to give up on an old growth model of its relying on exports and to increase its economic transformation. If the initiative of Trump’s maximum 15 percent corporate tax rate is approved by the US Congress, it could flash increased foreign investments into the United States of America. Also, re-shoring of USA’s businesses would be happening to create a shock to the global and Chinese economy as a whole. China might have to cut its own domestic corporate tax in this possible case.
The tariffs imposed by the United States on China will not only affect China but it might hurt other countries too as it is true that China exports a lot of steel to the United States but more than that Brazil, Canada, Mexico and other countries do. The metals are used in a huge range of industrial applications that include cars and infrastructures. It is questionable that the imports might pose a threat to the natural security of the country. The United States is the world biggest steel importing country in the world. The top shipment of steel is done by Canada. But the ones affected by this also includes Japan and South Korea. China is not one of the Top 10 countries from which the United States imports steel. In fact, it is not even included in the Top 10 list of steel importers. It is said by trade experts that if Trump goes that route, even U.S. allies like Canada, South Korea, Mexico could be willing to stick tariffs of their own on U.S. exports like agricultural products, or picking non-U.S. goods — like Airbus planes over Boeing models. Beijing is said to take necessary measures to protect its interests if the final decision of the United States affects the country. The unfinished products made from steel are sent to South Korea and Vietnam where the workers put the final touch on the products and ships the finished products to the United States. After that, it is marked as a Vietnamese or Korean import. If that path is closed it indirectly affects China. If Trump invokes Section 232 of the Trade Expansion Act, as is recommended, then it is said that he tends to believe that it is hurting the natural security. Trump must respond to the reports by April 11 and 19 for steel and aluminum, respectively to avoid the risk of trade wars and the threat of natural security being imposed on the country.