As per the Trade war between US and China, Donald Trump is all set to cut back on Chinese investments. Due to the present move, there was a tremendous fall in stocks since Dow Jones Industrial Average shed more than 150 points.
In an exclusive interview with the media Stephen Roach stated that the present move of the American administration can be considered as an unmitigated disaster. On Friday Roach stated that it is very essential that the US and China should have open access for other individuals’ market as China is considered as the biggest market to get consumers.
China and America were trying to negotiate on bilateral trade since more than a decade so that both the countries can open their markets for each other. Roach said that America has treaties of bilateral investment with more than 40 nations on the contrary, in case of China the number is 145. To provide cross-border opportunities to MNC’s open and free investment is considered as the most efficient way.
In a recent survey report released on Friday, there are many consumers who cited the present trade policy unfortunate for the economy of the US. Roach further made it clear that due to weakened global economy, it is highly likely that recession might occur in Europe, then in Japan and East Asia. He said that though the US consumers have been the real reason due to which the economy has stabilized but loss of job opportunities in the country might lead to serious issues.
Stephen Roach made it clear that the present proposal by the US government will only make things worse. The progress which the country has registered is in soybean strategy in which the Chinese government has to purchase more products used in agriculture. At present, America is also dealing with saving problem and has got high trade deficits. Thus it is doesn’t give opportunity to the country for bilateral fix for its multilateral problem.