As an object of analysis, the article “China Cuts Tariffs on $75 Billion in U.S. Goods” by Tejada (2020) will be reviewed and summarized. An economic term used in the context of the review is a trade-off, which is a compromise between two parties in relation to regulating a specific financial or any other issue. Its application to the article in question is due to the theme of a truce between China and the United States with regard to tariff prices and the suspension of their protracted trade war.
The outbreak of the coronavirus in China has become one of the drivers stimulating the country’s government to reconsider its foreign economic policy. In response to US actions to reduce tariffs on Chinese goods, the eastern authorities did the same. According to Tejada (2020), many conditions have remained unchanged, but some positive changes occur. The agreement on the purchase by China of goods worth a total of $200 billion over the next two years is a guarantee given to the United States. As a result of this trade-off, the countries began moving towards each other. At the same time, concomitant issues arise, and one of the main ones is the outbreak of coronavirus.
As Tejada (2020) states, in addition to problems for the healthcare sector, the epidemic inevitably entails economic challenges, for instance, logistical difficulties, a decrease in the share of imports, and other negative implications. The fall in oil prices is one of the consequences of the expected demand from China. Thus, today, the trade-off is valuable for both parties: the Chinese authorities can buy cheaper products, and the US government can expand the export of goods.
References
Tejada, C. (2020). China cuts tariffs on $75 billion in U.S. goods. That was the easy part. The New York Times. Web.