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A China-U.S. Trade War Will Harm Africa
By Paul Kipchumba | ChinAfrica Web Exclusive ·2018-04-11

The simmering trade tensions between China and the United States over future competitiveness are not just about them. These two economies are the largest in the world and, to a larger extent, determine global economic rules and business itself.

The U.S. President Donald Trump is following through his pre-election "America First" maxim in focusing on disabling or, preferably, constraining China's emergence as an economic power. He began by clearly labeling China "a strategic competitor" and then focused on reducing the U.S. trade deficits with China by employing security-related caveats on key technologies, and by imposing tariffs. Most sound economists argue that it is nearly impossible to narrow trade deficits by tariff measures. Thus it is this realization that is the cause for concern, with China threatening reciprocal adverse tariff measures.

One region that might be seriously affected is Africa. China and the United States are Africa's largest trading and aid partners respectively. But by the mere fact that the two economies are focusing on each other, with a possibility of multilateral systems being ignored, then Africa is bound to be ignored too. And the gains made so far are bound to be lost too. Thus Africa's hopes for enhanced material well-being will be undermined.

There is a lot at stake for Africa in the China-U.S. trade conflict. If the tit-for-tat measures weaken the global economy, the demand for Africa's commodities is affected, infrastructure spending in Africa will be compromised, and anti-terrorism campaigns and resolutions currently underway for Africa's political instability challenges will be equally affected because the two countries are the most invested and engaged in them. An example of this is Mali and Somalia anti-terrorism campaigns, and South Sudan conflicts.

If the major bone of contention is about future competitiveness, with Made in China 2025 ambitions and China's quest for market in artificial intelligence (AI) being at the center of it, it is in the best global interest for the United States to work amicably with China to resolve them. Otherwise, the adverse reciprocal and counter trade measures might lead to uncontrollable global economic misery.

However, looking at the prevailing economic statistics, none of the two major economies enjoys absolute advantage in sanctioning the other. Therefore, it is recommended that the policymakers in the two economies should reason together to resolve their trade disputes to avoid degenerating further into a full-blown trade war that has the potential to cause a global economic recession, thus compounding existing Africa's material challenges.

(The author is a Kenyan and author of Africa in China's 21st Century: In Search of a Strategy)

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