That happened before, US didin't recognize P. R China untill 1979. That only means cutting off the diplomatic relationship, it happened with other countries before so no big deal.
Thats not really correct. Formal recognition was in Feb 1972 . "
Shanghai Communiqué "
Economic war needs to be fought on economic grounds.
China is already defying the US by increasing oil purchases from Iran. What is more meaningful is that most of EU countries do not as well listen to the US orders.
The most valuable strategic gain China can get from Iran affairs is if the US-Europe alliance is fractured.
War must be grounded on this level.
Selling this or that weapon to Iran is pointless because the US will always out-spend and out-militarize.
Solution of a problem lies in finding and addressing the problem.
The problem in this case is
well known to be the manufacturing overcapacity of China. Solution is to increase ( local )demand to absorb that capacity. In some sectors China did indeed do that as we have seen the construction of infrastructure. but in other sectors its been unable to do so. So it dumps its produce on the world.
Since 2006/7 there has been pressure on China from US to increase its currency but China has been dragging its foot for fear of a total collapse. China knew this was coming a long time back. Hence the belt initiative to find newer markets. back at the time it was recognized that if China's economy collapsed as well as other countries ( which were under recession at the time ) it would be harder for the world to stand back up. So Chine was given leeway. But that time has ended.
The Belt projects will help China offset some damage but I think at the rate of projects, China is still simply unwilling to address the issue of overcapacity.
China needs to improve its own markets , I believe it was a huge mistake on China's part to retaliate and they simply got suckered in due to Trumps demeanor and they keep retaliating, why i am not sure. Really, They are behaving JUST LIKE TRUMP! They must realize that Trump is all in at this point in time.
So who will be the bigger loser when all trade is Tariffed? Sure China can move some production to other countries and then they may re-export to US without tariffs. But that would mean they will actually create competition for themselves and not really address the core problem. I mean really, most of China's export products can be made in any other country. Most already are made in many other countries as well.
If they hadn't retaliated , they would have had a longer timeline to finish the belt and road programs And the Value of renminbi would have increased naturally and the whole fiasco would have been avoided. It really was easy to do it.
Just call Trump crazy and say we'll wait for a saner person to come to power. Now they have handed Trump the second term.
