The Fin Why Donald Trump & Xi Jinping will do a deal
Apr 23, 2025
Geoff Raby, a Financial Review columnist and former ambassador to China, shares his expert insights on the US-China trade war and its implications for Australia. He explores why both nations might strike a deal, despite ongoing tensions. Raby discusses the strategic responses from China and the evolution of trade dynamics, especially in solar energy. He emphasizes the importance of transparent leadership in Australia as the nation navigates its diplomatic stance between superpowers. The conversation sheds light on the complexities of international relations and economic impacts.
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US Manufacturing Decline Reality
- The US manufacturing decline is due to long-term global trends, not just China.
- US services surplus reflects its economy's shift from manufacturing to technology and services.
Trade War Fuels Chinese Nationalism
- The trade war could reduce China's growth by 1-2 percentage points this year.
- The trade war fuels Chinese nationalism and strengthens Xi Jinping's leadership image.
China's Economic Support Tools
- China can use fiscal expansion, interest rate cuts, renminbi depreciation, and regulatory easing to support the economy.
- Boosting the housing sector and consumer confidence is key amid the trade war challenges.