Trade tensions between the United States (US) and China are once again heating up, with various policy measures potentially impacting the global economy. This conflict has been a major focus for years and continues to have significant effects on international trade.
China’s Retaliation Against the European Union
China recently announced an extension of its anti-dumping investigation on certain products from the European Union (EU) for another three months. This move is suspected to be a response to EU trade policies perceived as detrimental to China’s economic interests. Chinese authorities stated that this decision aims to protect their domestic market from unfair competition.
Meanwhile, the European Union has expressed concerns over China’s increasingly protectionist trade policies. These tensions further complicate the trade war, as the EU is a key trading partner for both the US and China.
Opportunities for Indonesia
Amid these tensions, Indonesia is seen as having opportunities to capitalize on the situation. According to Esther Sri Astuti, Executive Director of the Institute for Development of Economics and Finance (Indef), this trade war could provide Indonesia a chance to expand its role in the global supply chain.
“When trade relations between the US and China are disrupted, developing countries like Indonesia can take on the role of alternative suppliers,” said Esther. She also noted that this could attract foreign investment and boost Indonesia’s exports to global markets.
A notable example is Smart Vape Factory, a vape manufacturing plant based in Indonesia that has successfully penetrated the US market with a 0% import tariff. This success highlights Indonesia’s significant potential to seize trade opportunities amid global tensions.
Concerns About US Trade Policies
On the other hand, several countries are preparing for potential negative impacts from US trade policies. The current US president is considering implementing new tariffs and other trade barriers that could cause economic turmoil in various countries.
Observers have pointed out that US protectionist measures could undermine the multilateral trade system that has underpinned international commerce for decades. Developing nations are especially vulnerable to these changes as they rely heavily on global trade stability.
Long-Term Impact
The US-China trade war is expected to continue having long-term effects. From rising commodity prices to disruptions in global supply chains, this conflict remains a central concern for economic players worldwide.
With uncertainty still looming over trade relations between these two economic giants, other nations, including Indonesia, need to take proactive steps to address challenges while leveraging available opportunities.