Using the effects of the policy of the country chosen for your final project, discuss predictions and recommendations on output and demands using international evidence. (China free trade agreement and United States)
The future looks dim both for US and China largely due to Surfaced tensions like trade war, inverted yield curves, yuan depreciation and US Fed anti government views.
The output or real GDP looks slumped mostly due to lower ibterest rate cuts, excessive sanctions and trade restrictions, lower liquidity, income inequality,
The biggest issue been surfaced is US China Trade War, Immigration Laws, US National Debt, Foreign Relations policy
US and china have great history of trade wars however recent times has been largely due to sanctions been imposed on china by USA.
Recently, USA slpped tarrifs on 40% of chinese goods. which has caused prices of US goods to go up substantially becuase cheap imports fro china have been stopped.USA has also stopped cheap imports of steel and as a result Chinese government too has imposed substantial tarrifs on USA goods.
As a result, there has been currency devaluation in China to make it goods look more cheaper and attractive and has started selling Goods in emerging markets. US goods however have become more costlier and hence sales have decreased.
Chinese government has aggravated trade war by imposing fresh round of tarrifs , however before G20 summit which will be held in 2018, such issues will be resolved.
Since, China has imposed tarrifs we see there has been lack of
entry of chinese workrs and visas in USA which has nullified the
clear cut winner. Because of trade war, India has managed to export
steel and aluminium to US markets and hence has been the greatest
beneficiary.
Given the Presidential Power following economic strategies need best case implementation :
Resolution of NAFTA deal with negotiation as well as maintenance
of great relationships with South Korea on denuclearization by
maintaining an eye on all developments
US China pact and removal of tarriffsby signing of MOU and economic
cooperation
Immigration laws been relaxed by allowing H1B for Indians who look
to create startups IN UsA and generate more employment
Debt refinancing and additional taxation on corporates with large
market Capitalization to decrease debt in short term.
Increasing interest rates to appreciate dollar and control
inflation and money supply in market
References:
Bailey, Martin Neil, What Happened to The Great American Job Machine!? The impact of trade and electronic Offshoring.
Cline, William R 2004. Trade policy and Global Poverty. Washington : Institute for International economics
Goldman Sachs, 2003. Dreaming with BRICS: the path to 2050. Goldman Sachs Global Economics paper 99
Zoelick, Robert B 2001. American Trade Leadership : What is at Stake? Speech before Institute of International Economics washing mton, September 24.
Schott, Jeffrey, 2004. Free trade agreements :US strategy and
Priorities. Washington: Institute for International
economics
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