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Navigating Global Tensions: Strategies to Prevent Trade Wars

Navigating Global Tensions: Strategies to Prevent Trade Wars

In Karachi, US Treasury Secretary Janet Yellen embarked on her second official visit to China within a year, spanning from April 4th to 9th. The objective of her visit was to assert Washington’s global dominance amid the ongoing trade tensions between the two superpowers, particularly in light of the upcoming presidential elections later this year.

Yellen aimed to persuade Beijing to restrain its growth, exports, and expansion plans in key sectors such as electronic vehicles (EVs), solar panels, batteries, and semiconductors. These technologies are crucial not only for providing access to affordable and eco-friendly energy solutions to developing nations but also for collective action against the escalating global climate change crisis.

However, the US perceives China’s initiatives in these areas as a threat to its international economic influence. It continues to advocate for free and fair competition, as mandated by the rules governed by the World Trade Organization (WTO), to safeguard American businesses both domestically and globally.

Also Read: Pakistan and Japan Commit to Strengthen Trade Ties

President Joe Biden has rallied allies, including European nations, the UK, Japan, the Philippines, and India, to exert pressure on China. The aim is to persuade Beijing to scale back its environmentally friendly export plans and foster a cooperative working relationship instead of adversarial dynamics. According to a recent report by Reuters, Yellen highlighted concerns about the global economic repercussions stemming from China’s surplus manufacturing capacity during her four days of economic meetings with Chinese officials.

Chinese Premier Li Qiang emphasized the importance of partnership between the two countries and urged adherence to fundamental market economy norms, including fair competition and open cooperation. He advocated for a balanced, market-oriented, and global perspective on production capacity issues.

Experts suggest that Yellen’s visit may have minimal immediate impact on the complex relationship between the two nations. Changes in US leadership following the upcoming presidential election might gradually ease tensions. However, President Biden’s efforts to counter China’s rise are largely geopolitical and sometimes conflict with WTO regulations.

The US-China trade war, which commenced in 2018, has led to significant tariffs imposed on imports by both countries. This conflict has contributed to inflation and negatively affected livelihoods worldwide, resembling another Cold War scenario. However, China remains committed to peaceful progress and asserts its emergence as a global economic powerhouse, signaling a shift from a unipolar world dominated by the US.