Trade is the backbone of a thriving economy
The US economy is likely to receive significant negative impacts due to the recent US-China trade war. This is due to increased tariffs levied on goods imported from China.Thus causing a retaliation from the latter on half of the exports from the United States of America. This leads to an increase in the prices of goods. Since imported goods become more expensive due to the taxes imposed and domestically produced products will be sold at higher rates even though manufacturers do not have to pay the said tariffs.
Will Truck Drivers be affected by the trade war?
It is important to note that the trade war and Chinese imports are more than half of the containers received at the US ports. A hefty increase in tariffs could cause a dent in the US economy as well as the loss of a lot of jobs in the transport and logistics sector. These are the people who are responsible for moving imports from China from the ports to distribution areas.
Effects on Nationwide Transport
Although trade war and trade restrictions have been experienced for a while, it is essential to note that the relationship between imports and GDP in the US economy has remained constant in the previous years. However, the following is more likely to happen:
- This impact will be experienced bitterly by companies that handle large international shipments. This is because it would take a more extended period for trade to filter into other countries.
- An increase in tax would threaten auto transportation since the transport sector would see an increase in the price of fuel. This would cause unrest since repayment will remain unchanged regardless.
- Not forgetting the fact that this would consequently result in a decrease in demand for transportation services.
Some people give support to the government’s initiative arguing that in the long term, this would be a solution since trade practices haven’t been fair to them for a long time. It is trying to level the ground for a better trading platform.
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List of Sources
- https://www.nytimes.com/2019/05/23/business/china-us-trade-war-rare-earths.html
- https://www.nytimes.com/2019/05/23/business/shares-stock-markets.html
- https://www.nytimes.com/2019/05/23/business/dealbook/semiconductor-stocks-trade-war.html
- https://www.reuters.com/article/usa-trade-transportation/trade-war-could-impede-u-s-transport-infrastructure-growth-fitch-idUSL1N1U70VV
- https://www.logisticsmgmt.com/article/top_30_u.s._ports_trade_tensions_determine_where_cargo_goes_next/transportation