​Chinese check, Pg6

Key Highlights:

• The US-China tariff war saw a temporary truce after a meeting between Presidents Trump and Xi in Busan, South Korea.
• The US trade deficit with China narrowed by roughly 30% due to tariff offensives since 2017.
• China committed to resuming purchases of American farm products and easing export restrictions on critical minerals.

Detailed Insights:

• The trade deficit reduction was largely due to trade diversion through near-shoring and friend-shoring to countries like Mexico and Vietnam.
• China's response included market diversification, price adjustments, and domestic stimulus measures under its "dual-circulation" strategy.
• The US remains the largest consumer market, while China has solidified its position as the world's leading factory with leverage over intermediate goods and technology.

Key Concepts Involved:

• Neoliberal Reforms: Economic policies promoting free markets, deregulation, and privatization.
• Labour Arbitrage: Exploiting differences in labor costs to gain a competitive advantage.
• Dual-Circulation Strategy: China's economic strategy focusing on both domestic and international economic cycles.