China and US Tariff War Caused World Economy to Suffer

Media Release - Port Technology, 07/09/2018, 09:00


The trade wars that is happening between United States of America and China caused global economy to suffer. The world trade fell by 1.3% in August 2018. Global Kuehne + Nagel Indicator in their monthly reports of World Trade Indicator reveal this fact that they found. Despite a strong market in July, when the markets look solid and steady even though there are threats of tariff war between the world’s two biggest economy, however, the World Trade Indicator suggest that the investor starting to become cautious because the pressure on global agreement and institution starting to leave their marks.

China experienced a decline of 12.2% on their year-on-year export growth in July 2018. And in August 2018, they saw their YoY growth declining by 7%. This is a negative trend that is expected to continue until at least September 2018 because the trade wars between China and US has starting to affect the manufacture and the value of China’s currency, Yuan.

United States Trade Representative is currently consulting the USD 200 Billion worth of tariff to China. It is expected to come into effect on September 6th 2018.

According to gKNi, global trade value is consistent with the forecast of manufacture output. September 2018 is to be expected to have the lowest monthly growth since July 2015. On its report, gKNi said, “After a strong gauge in July, the new data show negative trend. The sharpest slowdown is expected for emerging markets, which are most exposed to any impact from rising trade tension.” “In September, a major setback in export is expected in South Korea, Japan, Taiwan, India, and Brazil.”

gKNi predicted that global trade will continue to decline until September 2018. Emerging economy will suffer the most from the trade wars between China and US. Japan is expected to see a decline of 10.2% in their YoY export value, while South Korea will experience an 11.8% decline. India, Taiwan, and Brazil are also expected to experience losses of 9.8%, 8%, and 4.8% respectively.

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