China-Australia Trade War ?
- Thread starter Stockolio
- Start date
Trade war between China and Oz is like a physical war between Saudi and Lebanon
Well if China is making concessions with USA for Trump to get his way, it has to recoup its losses somewhere else and Australia is its next biggest trading partner and is dependent on China for its economy. Since Trump is screwing his downline to get ahead now all the countries have to screw their downlines too otherwise they will be screwed themselves and nobody wants to get screwed. And now Australia will have to turn around to screw its downline in international trading after it gets screwed by China oh but wait there is no downline for Australia to screw because Australia is a resource economy; it's the ultimate downline for everybody. Well Australia is royally screwed then.
That's how it is in international trading a la Trump.
That's how it is in international trading a la Trump.
You sir don't understand how international trade works:
1. China and the US agree on a new trade deal whereas China will import more coals from the US and stop importing coals from Australia.
2. Since the US does not produce enough coals for both China and domestic consumption, we then import coals from Australia to make up the difference.
So now all parties are happy and the countries that own ships will be laughing all the way to the banks since now we need twice the # of ships to ship from US to China and Australia to US instead of just from Australia to China.
You got it, China has one of the largest fleets of commercial ships.
You sir don't understand how international trade works:
1. China and the US agree on a new trade deal whereas China will import more coals from the US and stop importing coals from Australia.
2. Since the US does not produce enough coals for both China and domestic consumption, we then import coals from Australia to make up the difference.
So now all parties are happy and the countries that own ships will be laughing all the way to the banks since now we need twice the # of ships to ship from US to China and Australia to US instead of just from Australia to China.
You got it, China has one of the largest fleets of commercial ships.
Well in International Economics, one is supposed to import all from the country(ies) that produce the good at *comparative* advantage, not necessarily total advantage, i.e. the country that produces the good at higher efficiency even than another good for all countries. So according to this theory, everybody both USA and China is supposed to import coal from Australia because Australia is clearly the country that produces coal more efficiently than either of the countries, total and comparative advantage. But of course USA's powerful coal producer lobby groups would not have that so here we have this setup that totally violates all rules of efficiency creating all kinds of precious resources that could've been allocated to other economic activities, creating pollution, and resulting in less revenue for all countries involved, all a mess.
And as for Australia, it really needs to diversify its economy away from this total dependence on China. I know it's more efficient to just trade with one country but really there are other factors that also need to be considered. https://www.marketwatch.com/story/a...h-china-coal-ban-2019-02-21?mod=mw_latestnews.
And as a matter of fact, all of the Western countries should diversify away from China and should've done that a long time ago and not wait until this last minute now that China has become a threat and now we are scrambling to find alternatives to China. Since we have never invested or invested adequately in other countries before and now none of them are able to stack up to China to take its place and now we are stuck with China and have no choice but to continue to deal with China. All those trade deal talks, that shouldn't be necessary. We have WTO, WHY do we have to hold this exclusive unilateral talks with China alone for trade deals? It's because China has become too big and cannot even be contained in WTO anymore. What about other countries in the WTO, our allies and potential new trading partners? If we are going to always hold those unilateral talks with just one country, what's the point of trade organizations like WTO?
We have nobody to blame but ourselves for our complacency and shortsightedness.
And as a matter of fact, all of the Western countries should diversify away from China and should've done that a long time ago and not wait until this last minute now that China has become a threat and now we are scrambling to find alternatives to China. Since we have never invested or invested adequately in other countries before and now none of them are able to stack up to China to take its place and now we are stuck with China and have no choice but to continue to deal with China. All those trade deal talks, that shouldn't be necessary. We have WTO, WHY do we have to hold this exclusive unilateral talks with China alone for trade deals? It's because China has become too big and cannot even be contained in WTO anymore. What about other countries in the WTO, our allies and potential new trading partners? If we are going to always hold those unilateral talks with just one country, what's the point of trade organizations like WTO?
We have nobody to blame but ourselves for our complacency and shortsightedness.
No worry, just a couple of tongue in cheek comments. Don't take it too seriously.
Have a good day.