US and China will have many more battles to fight when the trade war ends
- Negotiators are focused on resolving a long-running tariff dispute but the conflict between Washington and Beijing extends far beyond sales of soybeans and aluminium
- Technology, politics, ideology and even the military are all areas where tensions could bubble over, analysts say
China and the United States appear closer than ever to an accord that would end their trade war but policymakers and investors are not popping any champagne.
As Washington’s top trade negotiators prepare to meet their counterparts in Beijing on Tuesday amid expressions of confidence that China’s markets will further open up, many with stakes in the talks’ outcome are focused on other developments – like the US government’s recent moves against a Chinese company that owns a popular gay dating app.
Rarely does a week go by without an announcement about US sanctions against Chinese companies, espionage investigations or warnings from lawmakers that the US military must prepare for a hot war with China.
The trade deal that is likely to come within weeks will be barely enough to slow a less visible but more lasting clash. Many believe more serious conflicts between the two countries are just unfolding.
“US-China relations have entered a competitive phase that goes well beyond trade disputes,” Richard Turnill, lead researcher at BlackRock, the asset management giant, wrote in a global outlook report this month.
“Tensions have broadened to include technological, political, ideological and military dimensions – and we see them as long-lasting.” He warned investors against confusing “any trade truce with a detente in the overall relationship”.