Impact of U.S-China Trade War on European Union

Topic 

Impact of U.S-China Trade War on European Union

Instructions 

Write a paper analyzing the impacts of U.S-China Trade War on European Union

Answer Preview 

The direct impact of the war is very minimal however financial markets are over reacting to the situation. The escalation of the trade war in recent months seems to be the end of a multilateral platform for the three regions. In response, European Union seems to stay neutral to the situation. Continued stress from these two nations may see diversion of trade creating pressure especially on prices of commodities in Europe

Should China look at Europe as leaning on the U.S side, the impacts could be catastrophic. Some economists argue that Europe could go into recession by end of 2019 if this would happen. Other trading partners such as Australia that provide a lot of raw materials will face trade deficits. In essence the balance of trade in the global market has shifted from equilibrium. The impacts are expected to grow with the intensity of the war. This article looks to define the impact of the U.S-China trade war on Europe and possible solutions. For China, trade deficit with trading partners is expected to rise as show in the graph below.

Word Count: 1900