The fight of elephants!

Hard Talk


THE US-China trade war is getting hotter and exciting. Rounds of action are consecutive and fast. Sometimes they are open and clear, at other times one needs to study, analyze and read perfectly to understand what exactly is behind these events.

The US administration has inflicted successive and painful strikes on China by raising the tariff on Chinese products and then putting one of the most important and successful Chinese companies, Huawei, on the blacklist.

The US has warned all American companies against any dealing with the telecom giant for major technical projects and urged its allies to follow the same approach. Following the order, US giant Google has stopped supporting Huawei and its mobile phones, which account for 16 percent of mobile phone as the latter aims to be the bestseller in mobile phones by 2020. Google has unwound services like Gmail, the world's most popular e-mail program, and the popular YouTube application, which has led to Huawei's suspension of a production line in its factory in anticipation of a massive loss of sales due to the concerns and anxieties of its target customers.

These are “explicit” examples of trade warfare. But there are other examples that are no less important and need to be followed and studied in order to understand the bigger picture.

China continues to believe that its economic growth is the largest and most effective way to control and dominate the world without firing a bullet, military occupation or shedding a drop of blood, as it is the most effective way to change the status quo on the ground. It, therefore, needs to provide and secure energy sources to feed sustainable and reliable economic growth rates.

To this end, China has maintained deep relations with various oil countries. The most important of these investments was with Venezuela and Iran, the two countries that have seen billions of dollars from China flowing into them to build oil sector infrastructure. The two regimes are anti-American, and America has directed its effective and influential weapon, the severe economic sanctions. This has led to deterioration in oil exports and hit the economy of these countries, and the value of Chinese returns has been much lower than it should have been, in addition to an export ban.

China is also trying to gradually "spread" its currency around the world, focusing geographically on both the African continent and Latin America, and Latin America is a direct threat, which was recognized by the administration of US President Donald Trump when it was discovered that the Chinese Yuan has become the second largest currency traded in Mexico after the local peso surpassing the dollar.

This was one of the main reasons why Trump imposed an alternative agreement to the NAFTA and imposed a new reality on the ground in the disputed areas of various islands with Japan, the Philippines and Vietnam, all of which are allies of America.

America understands that the Chinese threat is very serious, especially as it sees technical superiority of China in the fields of communications and its fifth generation technology, as well as in the field of fast trains, which has led to the US administration accusing the Chinese students and tourists as a group of people who are spying on the future of the American industry.

China-US trade war rounds will eventually become more ferocious. Today, America is entering the European line with all the strength to prepare every country to "graduate" from the European line with a differential agreement with America.

This war is not between two states, but between two great powers, and they will have implications for world markets and stability. I am reminded here the immortal African proverb that says: "When elephants fight, it is the grass that suffers.”