The new protectionism between the USA and China and international trade policy amid worldwide geopolitical turbulence

Abstract

This paper discusses the new protectionism between the United States of America and China and examines international trade policy amid worldwide geopolitical turbulence. The primary research task is to comprehensively analyze the current trends in foreign trade theory and policy, and in particular, the foreign trade policy models, trade interests indicated by export orientation and import sensitivity, the types and degrees of protectionist pressures in different political systems, new trends in international business, and the USA's motives for imposing tariffs and import restrictions. China will be significantly impacted by an import tariff trade war in all indicators, including welfare, gross domestic product (GDP), manufacturing employment, and trade. However, it has been pointed out that although China will be significantly affected, the costs should be sustainable and not severely damage the Chinese economy. As for the United States, the simulation results indicate that there will be welfare, GDP, and non-manufacturing production gains, but employment and trade losses.

Keywords

• protectionism
• international trade policy
• supply chains
• trade war
• geopolitical turbulence