NDEGWA: We need to take stand in US-China trade row

By , K24 Digital
On Wed, 12 Jun, 2019 21:54 | 2 mins read
US President Donald Trump.

Stephen Ndegwa

The escalating trade spat between the two largest economies in the world—the United States and China, —is emerging as a serious threat to the global economy.

China must have seen it coming, after claims by the US for over a decade that Chinese tech giant Huawei was engaged in unfair trade practices and surveillance.

With no evidence of these accusations, however, it can only be concluded that finally placing Huawei on the so-called entity list aims at sabotaging China’s 5G network pioneering role. 

Whatever was hidden between US and China’s trade rivalry is just coming to the fore. On June 6, China’s President Xi Jinping and his Russian counterpart Vladimir Putin, met in Moscow during celebrations to mark the 70th anniversary of diplomatic relations between the two countries.

It is a case of “I have your back” between the two leaders. Both countries need each other to fortify their economies from what can be seen as US President Donald Trump’s bullying. 

Trump looks determined to forestall China’s global ambitions by going for her allies as well. For example, the US Senate is set to discuss sanctions under a new bipartisan bill that seeks to punish European ships involved in the construction of a controversial gas pipeline from Russia to Germany.

This could be a way of sabotaging the ambitious Belt and Road Initiative that aims at building interconnected trade routes around the world.

Beijing is not taking Trump’s belligerence lying down either. On June 5, China’s Ministry of Culture and Tourism warned its citizens to “fully assess the risks” of travelling to the US in light of the recent mass shootings in Hawaii. It is estimated that over 10,000 people fly between China and the US daily, which is about four million people a year.

China recently published a white paper, China’s Position on the China-US Economic and Trade Consultations’, laying out its official position in the trade impasse.

The paper laments, among other things, America’s unilateral and protectionist policies, criticizes its backtracking on Sino-US trade talks and demonstrates China’s stance on trade consultations.

So far, African governments seem to have taken a wait-and-see attitude. But in a globalised world, the effects will be felt in coming months, if the situation is not ameliorated.

According to statistics from China’s General Administration of Customs, the country’s trade with Africa was the highest in the world in 2018. 

The import growth rate was also the highest in the world. China’s exports to Africa were $104.91 billion, up 10.8 per cent, and China’s imports from Africa were US$99.28 billion, up 30.8 per cent. 

If the spat continues, investment inflows from China are bound to decrease, owing to the fact that revenues from the US will reduce due to the effects of the increased tariffs and product ban. China might also aggressively sell her products to Africa to cover part of the revenue shortfalls. 

It’s time for Africa to strategise her place in the changing geopolitical map, and decide on which side her bread is more buttered. The best bet will be to stay with the empathetic partner, China. -The writer is a communication specialist—[email protected]