US-China trade frictions surfacing - Nomura
|Analysts at Nomura explained that today, some twenty years later, China has a mighty economy.
Key Quotes:
"At the same time, many US companies are feeling that they are no longer welcomed in the Chinese market. But this sort of outcome runs the risk of tripping the devastating landmine of opposing political systems that Deng Xiaoping did everything to avoid."
"Additionally, whereas the US-Japan trade frictions of the 1980s took place after Japan had joined the ranks of the advanced economies, today’s disputes between the US and China are happening even though China remains a developing economy. China’s per capita GDP is currently a little over $8,600, which means the authorities must now figure out how to escape the so-called middle-income trap."
"The economy could stall if trade frictions with the US delay the nation’s escape from this trap. For this reason as well, China will need to be more careful in addressing trade frictions with the US going forward."
"The Chinese president may already be aware of these issues. On 10 April, at the Boao Forum for Asia, Mr. Xi emphasized his intention to forge ahead with market-opening measures."
"But the problem of opposing political systems has deep roots, and I think resolving it may force the Chinese leader to channel his inner Deng Xiaoping."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.