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The US-China Trade War Can Be a Key Problem for Global Growth – Says Chief Economist at S&P Ratings

Shahina Khatun

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The Chief Economist at the S&P Global Ratings named Paul Gruenwald, today has told to CNBC that the slowing developing rate of China shouldn’t be a problem, but the unresolved trade war between the US and China could be. He told that they had been arguing about the issue that the China slowing from 8% then to 5.5% was a healthy development. He added that the labor force of China is either flat or shrinking, but the GDP per capita growth is still strong. So, this trade war is something like putting a larger dent on the global growth than the impact of tariffs. He also said that all those confusion around the entire United States-China trade war was putting a hindrance on the investments and even still it isn’t known where these two largest economies are heading towards.

As the war is becoming more intense, several American companies are now moving to supply the chain logistics out of the China and entering into the Southeast Asian nations like Vietnam, and the southern of the US like Mexico.

The S&P Global Ratings estimated that the tariffs led to 25 basis points that affected on the growth in both countries – United States and China. Gruenwald also said that the somewhat nebulous confidence seemed to have a larger drag on the growth than the tariffs. The Washington DC and Beijing – both are in a protracted trade war from last year and it is said that the next deadline for the tariff is 15th December.

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