Flags of the United States and China are positioned ahead of a conference in between United States Secretary of Agriculture Sonny Perdue and China’s Agriculture Minister Han Changfu at the Ministry of Agriculture in Beijing on June 30, 2017.
Jason Lee | AFP | Getty Images
The U.S. and China are heading into a brand-new “cold war” that might be more harmful to the world compared to the geopolitical contest in between the U.S. and Soviet Union at the end of World War II, an expert stated on Friday.
What separates the 2 competitions is the level of inter-dependency in between the U.S. and China today, stated Alan Dupont, president of danger consultancy Cognoscenti Group. The Australian business recommends customers on geopolitical, monetary and nationwide security patterns.
“Unlike the first Cold War where the primary contest between the United States and Soviet Union was a geopolitical one … both systems, both constellation of countries, didn’t have much to do from a trade and financial point of view. That is not the case today,” he informed CNBC’s “Squawk Box Asia.”
“That is why I think the ramifications of this conflict — this worsening rivalry between the U.S. and China — (are) going to be potentially very serious,” he included.
Relations in between the U.S. and China have actually weakened to their worst in years because President Donald Trump took workplace in 2017. The 2 nations have actually slapped a series of brand-new tariffs on each other because 2018, which intensified into a destructive trade war that spilled into other locations such as innovation and financing.
More just recently, U.S.-China stress took another turn for the even worse when the Trump administration blamed Beijing for not cautioning the world of the coronavirus pandemic earlier and concealing the level of its break out. Beijing has actually declined those claims.
Washington likewise struck out at Beijing for wearing down the liberty of Hong Kong, a semi-autonomous Chinese area that has an unique trading relationship with the U.S.
Several experts have actually cautioned that the competition might deepen even more as Trump is anticipated to promote a difficult position versus China as he looks for a 2nd term in the White House. The U.S. is set up to hold governmental election on Nov. 3.
“Now the contest is becoming more systemic and it’s really becoming a winner-takes-all kind of contest — so that’s the worst potential outcome,” stated Dupont.
“Unless there’s some kind of a circuit breaker — there’s no prospect of that in sight in the short term — the worry is that while we cope with the effects of the pandemic, you have this worsening tensions between the U.S. and China which is going to spread throughout the world and impact on global supply chains, on business and finance everywhere.”