How China can punish trade partners with tariffs

E

earth_imperator

Tariffs as a Punishment Measure and its Impact in Bilateral Trade

How China (or any other country) could punish a trade "partner" who violates the bilateral trade agreements between them.
The following is just an example with the given program parameters:
Code: 
Tariffs as a Punishment Measure and its Impact in Bilateral Trade

NormalGrowth      = +3.00% / period
PunishmentTariffs = -5.00% / period
NetGrowth         = -2.00% / period

period     start        end     dPeriod    dPeriod%        dAll       dAll%       endWOT    dAll%WOT         diff       diff%
   1      100.00      98.00       -2.00      -2.00%       -2.00      -2.00%       103.00       3.00%         5.00       5.10%
   2       98.00      96.04       -1.96      -2.00%       -3.96      -3.96%       106.09       6.09%        10.05      10.46%
   3       96.04      94.12       -1.92      -2.00%       -5.88      -5.88%       109.27       9.27%        15.15      16.10%
   4       94.12      92.24       -1.88      -2.00%       -7.76      -7.76%       112.55      12.55%        20.31      22.02%
   5       92.24      90.39       -1.84      -2.00%       -9.61      -9.61%       115.93      15.93%        25.54      28.25%
   6       90.39      88.58       -1.81      -2.00%      -11.42     -11.42%       119.41      19.41%        30.82      34.79%
   7       88.58      86.81       -1.77      -2.00%      -13.19     -13.19%       122.99      22.99%        36.17      41.67%
   8       86.81      85.08       -1.74      -2.00%      -14.92     -14.92%       126.68      26.68%        41.60      48.90%
   9       85.08      83.37       -1.70      -2.00%      -16.63     -16.63%       130.48      30.48%        47.10      56.49%
  10       83.37      81.71       -1.67      -2.00%      -18.29     -18.29%       134.39      34.39%        52.68      64.48%
  11       81.71      80.07       -1.63      -2.00%      -19.93     -19.93%       138.42      38.42%        58.35      72.87%
  12       80.07      78.47       -1.60      -2.00%      -21.53     -21.53%       142.58      42.58%        64.10      81.69%
  13       78.47      76.90       -1.57      -2.00%      -23.10     -23.10%       146.85      46.85%        69.95      90.96%
  14       76.90      75.36       -1.54      -2.00%      -24.64     -24.64%       151.26      51.26%        75.89     100.70%
  15       75.36      73.86       -1.51      -2.00%      -26.14     -26.14%       155.80      55.80%        81.94     110.94%
  16       73.86      72.38       -1.48      -2.00%      -27.62     -27.62%       160.47      60.47%        88.09     121.71%
  17       72.38      70.93       -1.45      -2.00%      -29.07     -29.07%       165.28      65.28%        94.35     133.02%
  18       70.93      69.51       -1.42      -2.00%      -30.49     -30.49%       170.24      70.24%       100.73     144.91%
  19       69.51      68.12       -1.39      -2.00%      -31.88     -31.88%       175.35      75.35%       107.23     157.40%
  20       68.12      66.76       -1.36      -2.00%      -33.24     -33.24%       180.61      80.61%       113.85     170.53%

Legend: start=startcap end=endcap d=Delta WOT=normal_w/o_tariffs diff=btw_endWOT_and_end
Interpretation:

In this example the punishment tariff is constant and kept 20 periods long. Period can be any interval, like quarter or year... :)

In that time span the bilateral trade shrinks by 33.24% (caused by the tariffs).

Without tariffs the result would be 178.53% better over tariffs.
And would grow 80.61% when there are no tariffs at all.
 
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earth_imperator said:
How China (or any other country) could punish a trade "partner" who violates the bilateral trade agreements between them.
More...
Just exactly who is this "trade partner"? Forget the tariff for the moment. What do you think would happen to China (or any other exporting country for that matter) if the US were to boycott "Made in China" and stop importing altogether? Have they ever thought about that? That day will surely come one of these days.
 
schizo said:
Just exactly who is this "trade partner"? Forget the tariff for the moment. What do you think would happen to China (or any other exporting country for that matter) if the US were to boycott "Made in China" and stop importing altogether? Have they ever thought about that? That day will surely come one of these days.
More...

US and the world won't stop importing from China cuz we are too addicted to "Made in China" things and we are too lazy to make shit ourselves. China knows that and that's why they are not afraid to use tariffs as the big stick. Biden has been advocating decoupling from China since the beginning of his administration and has even signed executive orders on it but it's just empty shit (shit actually has more substance than those executive orders). Till this day, China is still the largest import partner of the US, even during covid. https://tradingeconomics.com/united-states/imports-by-country. So much for decoupling. Makes you wonder, this is how much US imports from China even when there are executive orders to decouple specifically from China, imagine before when there was no intention to decouple from China how much we were actually importing from China. No wonder China is getting rich and we are getting poor especially when we are importing $541.53B from China and only exporting $151.07B to China https://tradingeconomics.com/united-states/exports-by-country, 1/5 of how much we are importing from China. And China still wants to punish its trading partners by imposing tariffs to flex its economic muscle? LOL Go right ahead, that will really help us import less cuz we won't have any money left to import from them anymore since we are exporting so little to China already. That would really help us decouple from China. Ironically it would be China itself who would be helping us to decouple from itself. LOL As usual the competent Biden can't do anything and has to rely on others to do his shit.
 
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TheDawn said:
US and the world won't stop importing from China cuz we are too addicted to "Made in China" things and we are too lazy to make shit ourselves. China knows that and that's why they are not afraid to use tariffs as the big stick.
More...
I think you're dead wrong. That was the past. I don't think that will work going forward. Just watch what happens in the next 5 years. we will completely wean ourselves from "Made in China" as a whole. Perhaps it will be replaced with "Made in India" or elsewhere but it won't be China.

Also we've come to see China for what it is. You don't need to look far. Just see what they've done to poor countries under the pretext of good will (eg. silk road initiative). They've pretty much enslaved them. For many, that should serve as a wake up call.
 
schizo said:
Just see what they've done to poor countries under the pretext of good will (eg. silk road initiative). They've pretty much enslaved them. For many, that should serve as a wake up call.
More...
I think it's a cheap propaganda by our drama queen USA making an elephant from a fly. :)
Which country do you mean? Just tell us the details of this "enslavement". :)
 
schizo said:
I think you're dead wrong. That was the past. I don't think that will work going forward. Just watch what happens in the next 5 years. we will completely wean ourselves from "Made in China" as a whole. Perhaps it will be replaced with "Made in India" or elsewhere but it won't be China.
More...
Wrong analysis. B/c your industry, companies, and economy and markets are dependent on China.
Not only for buying goods from China, but more importantly for selling goods to and in China.
You cannot have the one without the other, it's called bilateral trade, not one-way trade :)

You cannot convince any of the Eurpean countries, especially not the powerhouse Germany, for not doing any trade with China anymore. :)
B/c some of the biggest German companies nowadays make the majority of their profits in China since the Chinese market is the biggest in the World...

So, your theory is just wishful thinking as it fails the reality check :)

Admit that you are just a racist China hater, am I right? :)
 
schizo said:
I think you're dead wrong. That was the past. I don't think that will work going forward. Just watch what happens in the next 5 years. we will completely wean ourselves from "Made in China" as a whole. Perhaps it will be replaced with "Made in India" or elsewhere but it won't be China.
More...

I hope so. So far I am not seeing it. Right now, the closest China-alternative country, Vietnam is only the 6th largest import trading partner to the US according to the website from my previous post. India, a close 2nd, is currently the 8th largest import trading partner. It's kind of a long way to go from the 6th and 8th to the 1st and it certainly won't happen in the next five years, especially with Biden in power. Incompetence aside, Biden is a China lover. His whole family is in business with China; his son still has businesses in China. He tries to distance himself from China but business ties are hard to sever. So in a way it kinda explains why decoupling is not progressing faster. If we elect someone else like re-electing Trump, it might be a different story but if Biden stays in the office for four more years, I don't see China getting replaced any time soon, definitely not in five years.

schizo said:
Also we've come to see China for what it is. You don't need to look far. Just see what they've done to poor countries under the pretext of good will (eg. silk road initiative). They've pretty much enslaved them. For many, that should serve as a wake up call.
More...

Yeah but the problem is those "poor" countries have also come to see us for what we are. Many of these countries were former European or US colonies and honestly we didn't treat them any better during the colonial times. Is China really treating them any worse? I dunno. In some way, maybe but in some ways, maybe not. China is really giving them real stuff, stuff that we are too poor to give now. When our own infrastructure is crumbling to pieces and we are so heavily indebted, we really don't have any money to bribe others while China does, using money that they made and are continuing to make off us from all those "fair" trade agreements. That's the problem.
 
schizo said:
ust see what they've done to poor countries under the pretext of good will (eg. silk road initiative). They've pretty much enslaved them. For many, that should serve as a wake up call.
More...
Think of the tale of the frog in boiling water.
 
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