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By:
Dionela, Ashlee
Dungca, Janwayne B.
Contemporary World
Impact of the US/China Trade War in the Philippines
Table of Contents
Abstract……………………………………………………………………………………………………………………………………………….
Introduction ................................................................................................................................................... 3
The China – United States Economic Relations ........................................................................................... 5
A Brief History ......................................................................................................................................... 5
Treaty of Wanxia .................................................................................................................................. 5
Stoppage of Connections ...................................................................................................................... 7
Resuming of trade relations .................................................................................................................. 7
The China – United States Trade War .......................................................................................................... 7
Impact of the US/China Trade War in the Philippines
Abstract
Introduction
Trade, as defined by Investopedia, is a basic economic concept that involves the buying
and selling of goods and services between two entities. It is the exchange of compensations
between the parties involved. It can take place within an economy or between two countries.
In a broader picture, international trade allows different countries to expand their markets.
This type of trade lets different countries exposes their products to other countries while also
consuming those that are not available in their respective countries. Almost every kind of product
can be found on the international market: food, clothes, spare parts, oil, jewelry, wine, stocks,
Impact of the US/China Trade War in the Philippines
currencies, and water. Services are also traded: tourism, banking, consulting and transportation. A
product that is sold to the global market is an export, and a product that is bought from the global
market is an import. Imports and exports are accounted for in a country's current account in the
balance of payments. Global trade also means opportunity and variety to the economies involved.
Trade plays a key role in an increasingly interconnected and interdependent world. It makes
Two of the most powerful countries, the United States and China, are of course involved
in international trade. They are the trend and standard setters when it comes to trading. They are
also two of the largest markets in the global trade. Their economies also maintain a close
relationship with each other. We cannot deny that these countries have a large impact when it
Developing countries, such as the Philippines, have also engaged in international trade.
Opening doors to global trade is also considered as an indicator of development. The products
produced in these countries are being exported to large markets around the globe. And China and
United States being the largest markets, huge portions of these exported goods are also brought to
them.
Recently, it was reported that a trade dispute emerged between China and United States. It
became an alarming issue for everyone involved in the international trade because of the power
these two countries hold. The growing dispute can also affect our country, Philippines, for we are
also known as an ally of the US. Products from China are also being imported in our country. No
matter how much we want to be out of this trade dispute, we are still caught up in this problem.
Impact of the US/China Trade War in the Philippines
Because of our involvement in the international trade and the connection our country made
with the United States and China, we cannot also deny that this trade war has effects on us. This
paper aims to discuss not only the trade war that is happening in these two powerful countries but
also how are we being affected by their problem. It is important to understand that we share a part
A Brief History
The China – United States relationship can be traced back to when US first gained its
independence. The two countries are already maintaining a strong relationship between each other
for quite a long time now. It was deemed as a stable relationship with only a few problems affecting
their connections.
Treaty of Wanxia. It was in 1784 when the United States attempted to send a consul
to China. However, he was not received by the Chinese government. In June 16, 1844 the United
States government and the Chinese empire began their diplomatic relations. The two countries
engaged in negotiations and later signed a treaty called the “Treaty of Wanxia”1 on July 3, 1844.
This treaty contains provisions for (1) Extraterritoriality, where Chinese subjects would be
tried and punished under Chinese law and American citizens would be tried and punished under
the authority of the American consul or other public functionaries authorized to that effect; (2)
fixed tariffs on trade in the treaty ports; (3) the right to buy land in the five treaty ports and erect
1
Treaty of Wangxia – is also called as the Treaty of peace, amity, and commerce, between the United States of
America and the Chinese Empire.
Impact of the US/China Trade War in the Philippines
churches and hospitals there; (4) the right to buy land in the five treaty ports and erect churches
and hospitals there; and (5) the U.S. received most favored nation status, resulting in the U.S.
receiving the same beneficial treatment China gave to other powers such as the UK, and received
the right to modify the treaty after 12 years. This treaty also granted the Chinese Empire powers
to confiscate American ships if operating outside treaty ports, and withdrew consular protection in
cases where American citizens were trading in opium under articles 3 and 33, respectively.
In this treaty, the United States was represented by Caleb Cushing, a Massachusetts lawyer
dispatched by President John Tyler under pressure from American merchants concerned about the
English dominance in Chinese trade. Peter Parker, a physician and mission, served as Cushing’s
Chinese interpreter. On the other hand, the Qing Empire was represented by Keying, the Viceroy
of Liangguang.
The treaty marked the start of the China – United States economic relations.
Impact of the US/China Trade War in the Philippines
Stoppage of Connections. However, certain factors like the Vietnam and Korean
wars made these two countries stop their relations. The United States banned China in the early
1970s.
Resuming of trade relations. Shortly thereafter, the China – United States trade relations
then resumed in 1972 and 1973. Direct investment by the US in mainland China covers a wide range of
manufacturing sectors, several large hotel projects, restaurant chains, and petrochemicals. US companies
have entered agreements establishing more than 20,000 equity joint ventures, contractual joint ventures,
Ever since the trade relations of these countries resumed, problems emerged. One of the
problems began in 2006 when the US trade deficit with Mainland China exceeded $350 billion,
Beginning in 2009, the US and China agreed to hold regular high-level talks about
economic issues and other mutual concerns by establishing the Strategic Economic Dialogue,
which meets biannually. Five meetings have been held, the most recent in December 2008.
Economic nationalism seems to be rising in both countries, a point the leaders of the two
delegations noted in their opening presentations. The United States and China have also
established the high-level US-China Senior Dialogue to discuss international political issues and
In September 2009, a trade dispute emerged between China and the United States, which
came after the US imposed tariffs of 35 percent on Chinese tire imports. The Chinese commerce
minister accused the United States of a "grave act of trade protectionism," while a USTR
Impact of the US/China Trade War in the Philippines
spokesperson said the tariff "was taken precisely in accordance with the law and our international
Conclusion
Impact of the US/China Trade War in the Philippines
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