TRADE WARS ARE easy to win. So said former US President Donald Trump when he launched his against China in 2018. However, when it comes to China-US trade, the big winner appears to be trade itself.
Despite all the talk of decoupling and the trade war transmuting into a technology war and now a new cold war (perhaps), merchandise trade between the two countries has never been more extensive, recovering even from its Covid-19 pandemic setback.
The industrial policy measures taken by the US Biden administration may take some of the bloom off the rose once they have kicked in more fully, especially if Washington successfully cajoles US supply chains to move out of China.
Yet that is a slow process. For now, the talk is way ahead of the trade.
US multinationals, in particular, have proved resilient to both tariff and political pressures to decouple from China. The larger ones have the experience and clout to work the system.
Their Chinese counterparts are politically more constrained, self-evidently state-owned enterprises most of all, but they, too, take care of their own interests.