The trade war between the United States and China: causes and consequences
Over the past decade, the escalating tensions between the United States and China has dominated the global economic agenda. These disputes, marked by tariffs, technological restrictions and political differences, have altered the global economic landscape. The “US-China trade war” has generated significant impacts for consumers, businesses and intermediary countries such as Mexico, which play a key role in this confrontation.
Political and economic motives behind the conflict
The rivalry between the United States and China is not simply commercial; it is based on a strategic competition for global economic and technological dominance. Since 2018, under the administration of Donald Trump, the United States has imposed tariffs on Chinese products, alleging unfair trade practices, such as government subsidies and theft of intellectual property. Although the tariff approach sought to protect American industry, it also reflected a desire to curb China’s rise as a technological superpower.
On the other hand, the Chinese Communist Party has promoted internal growth policies such as the “Made in China 2025” program, which seeks to position the country as a leader in key sectors such as artificial intelligence, telecommunications and green energy. This objective clashes with the strategic interests of the United States, intensifying the economic and political conflict.
Impact on consumers and companies
The disputes have resulted in higher prices for consumers, particularly in the United States. Tariffs on products such as electronics, textiles and machinery have increased final costs. According to a study by the US National Bureau of Economic Research (NBER), tariffs imposed between 2018 and 2019 cost American households an average of $1,277 annually due to higher prices and lower product availability.
For companies, the restrictions have led to the restructuring of supply chains. Many companies have sought to move their production out of China to avoid tariffs, favoring regions such as Southeast Asia and, more recently, Latin America.
Global economic consequences
The conflict has disrupted international trade, slowing global growth and creating uncertainty in markets. Countries dependent on trade with these powers, such as Germany or Australia, have had to diversify their exports to minimize risks. In addition, technological tensions, such as the restrictions imposed by the United States on Huawei and TikTok, have fragmented the digital economy, creating separate technological blocks.
The role of Mexico and Latin America
In this context, Latin American countries such as Mexico have gained relevance as a viable alternative for companies seeking to diversify their supply chains. Mexico’s geographic proximity to the United States, its participation in the Treaty between Mexico, the United States and Canada (USMCA) and its competitive costs make it an attractive destination for the relocation of production, known as “nearshoring.“
Mexico has seen a boom in foreign direct investment in sectors such as automotive manufacturing, electronics and medical products. American and European companies have chosen to move part of their production from China to Mexico to reduce logistics costs and avoid trade tensions. This has strengthened Mexico’s position as a strategic partner for both the United States and other global economies.
What to expect in 2025?
The future of trade tensions will largely depend on the political and economic relations between the two powers. While President Joe Biden has maintained many of the trade policies of the previous administration, he has also sought to strengthen alliances with traditional partners to counter Chinese influence.
By 2025, the fragmentation of supply chains is expected to continue, with greater diversification into regions such as Latin America and Southeast Asia. In addition, technological development will continue to be a crucial battlefield, with both countries investing in innovation and emerging technologies.
Conclusion
The trade war between the United States and China has transformed global trade and will continue to be a key factor in the international economy in the coming years. Meanwhile, countries such as Mexico have the opportunity to consolidate themselves as strategic players in this new landscape, attracting investments and strengthening their position in global supply chains. For consumers and companies, the challenge will be to adapt to this changing environment, taking advantage of opportunities while facing the inevitable uncertainties that this conflict generates.