Trade tensions between the United States and China have resurfaced. Shipments from China to the US have decreased by 50% in the last 15 days. The US alleges that China has halted exports of crucial products, including rare earth minerals. The tariff deal reached between the two countries in April is also on the brink of collapse. China accuses the US of instigating new trade disputes.
Decline in US-China Trade
Trade tensions are once again intensifying between the world's two largest economies. Recent data indicates a 50% drop in the number of ships carrying goods from China to the US over the past 15 days. This represents the lowest level since February. Experts attribute this decline to the ongoing US-China trade dispute, which is significantly impacting the economic relationship between the two nations.
Tariff Deal in Jeopardy
US President Donald Trump recently accused China of violating the trade agreement reached between the two countries in April. This agreement included a 90-day reduction in tariffs imposed by both nations. Trump stated that the agreement with China was rushed and that China has not taken it seriously. US officials report that negotiations between the two sides have virtually stalled, and direct talks between Trump and Chinese President Xi Jinping may be necessary to find a solution.
Impact on Rare Earth Supply
The US Treasury Secretary recently stated that China has stopped exporting rare earth minerals and related products. Rare earths are crucial components in the manufacturing of advanced products such as smartphones, electric vehicles, F-35 fighter jets, and missile systems. This Chinese decision could significantly impact the US technology and defense sectors.
Conversely, China maintains that it has fully adhered to the trade agreement, while the US is escalating the conflict through unilateral decisions. China's Ministry of Commerce stated that if the US continues to harm Chinese interests, China will take necessary steps to protect its legitimate rights.
Competition Extends Beyond Trade
Tensions between the US and China extend beyond trade. The US has recently imposed new restrictions on technology exports to Chinese companies and taken steps to limit the number of Chinese students. Meanwhile, China's manufacturing activity has declined for the second consecutive month in May, indicating the widening scope of competition between the two countries.
