Chinese-US trade war threatens globalisation

Economic tensions may ease over the short term. But critical differences will only continue to divide rival global superpowers

As the US presidential elections approach and China concludes its 13th five year plan, a trade truce between the world’s two largest economies may be imminent. But any such deal is likely to arrest a further escalation in tariff tensions rather than fundamentally resolve bilateral differences. In China, decision makers are preparing for protracted tensions with the US and, while both sides profess that they are not seeking to ‘decouple’ ties, 2020 may—even inadvertently—be the year that markets see the first glimpses of deglobalisation. The on-again, off-again negotiations between the US and China could yield short-term respite and a freeze on new tariffs. This would likely calm market fears