Tensions between US-China over trade, technology ‘persistent’, could last for years, BlackRock says
- Trade war weighing on confidence in capital expenditure and manufacturing, according to the BlackRock Investment Institute
- US now an ‘exporter of economic and political instability’
Strategic tensions over trade and technology between the United States and China, as personified by the trade war raging for the past year, are “structural and persistent” and will last for years, if not decades, according to the BlackRock Investment Institute.
Ben Powell, the institute’s chief investment strategist for Asia-Pacific, said the trade war was already affecting confidence in terms of corporate capital expenditure, manufacturing production and growth globally.
“The US has moved to being an exporter of economic and political instability, perhaps for the first time since the second world war,” Powell said. “[The US-China tensions] will ebb and flow. There will be better days and worse days. There will be even better tweets and worse tweets.”
The BlackRock Investment Institute is a research division of BlackRock, the world’s biggest asset manager with US$6.5 trillion in assets under management.
The US has placed tariffs on thousands of Chinese goods in the past year as US President Donald Trump tries to force China to change years of trade and industrial policy. The two sides appeared close to a deal before May when the trade war escalated and the US put 25 per cent tariffs on nearly half of all Chinese imports.
