Research On Trade Effects Of Sino-US Trade Friction

Since the Trump administration took office in January 2017,the United States using the trade deficits,reinvigorating manufacturing and protecting workers' interests as apretexts,stepped up trade protections and sanctions against China.And in July-August 2018,the United States twice imposed 25% tariffs $50 billion worth of commodities on China,led to a full-scale outbreak of Sino-US friction involving all tradable commodities rapidly,further having bad impact on world's trade development,even reducing social welfare.After repeated consultations with multi part negotiation,the first phase of the China-U.S.economic and trade agreement was signed on January 15,2020.However,the United States can refuse to implement any agreement signed on the basis of "special safeguards" due to deficiency of the effective restricting mechanism about enforcement and supervision,or for any excuse.So that the road to easing Sino-US trade frictions is still full of variables and unmeasured disturbances.Based on this,this paper,which according to the analytical method with combination of theory and evidence,facts and assumptions,from the development characteristics of trade friction between China and the United States,taking trade deflection effect and trade diffusion effect as the starting point,uses GTAP model to simulate and analyze the two trends of SinoUS trade friction: being serious or easing.The main aim of the exposition above is to analyze the economy and trade influences of the two countries in both conditions.The research result shows that: Firstly,the escalation of Sino-US trade friction will result in loss of gains from economic and trade interests for both China and the United States at the same time,and the long-term game can only make the losses worse.Secondly,the escalation of Sino-US trade friction will just slim the trade gaps of the United States and boost America's manufacturing for a short time,but will not solve the problem fundamentally in the long run.Thirdly,the short-term easing of Sino-US trade friction softens will be more conducive to the resumption of trade flows in the United States.While the long-term easing will be more conducive to improving China's terms of trade,social welfare and other economic indicators.Fourthly,the escalation of trade friction between China and the United States will increase the trade flows of Mexico,Canada,Brazil and a few other countries or regions,but will reduce the scale of world trade and have a negative impact on the world economic and expense trade interests.Finally,according to Sino-US trade friction's situation of development and change,the paper puts forward the following countermeasures: Firstly,China should strengthen exchanges and consultations to deal with Sino-US trade friction under the premise of safeguarding its own interests.Secondly,China should strengthen science and technology on key industries and promote moderate development of trade in services.Thirdly,China should expand domestic demand in such a way of encouraging domestic consumption,especially consumption of domestic products.Fourthly,China should expand its foreign trade and economic cooperation targetingly.Fifthly,China should actively participate in the formulation of new rules for international trade.