When it comes to the trade war between the United States and China, Elbert Dijkgraaf, Professor of Empirical Economics of the Public Sector at Erasmus School of Economics, advises the following: ‘if you can’t beat them, join them.’
Trump is determined not to make it easy for the Chinese. And that in itself is understandable. For a couple of hundred years, China barely was a player in the world economy. Now, according to the World Bank and adjusted for purchasing power, the Chinese economy is larger than that of the United States. Everything indicates that China continues to grow faster than the US year after year, so the gap is widening.
Present-day’s rapid transport and communication possibilities make a superpower like China even more threatening. The US fears losing its position as a world power, says Dijkgraaf. ‘A trade war is then an instrument to try to slow down China’s growth.’
It seems that Western rulers are choosing a conflict model out of fear for Chinese influences. The past has shown that this approach is ineffective if the influence only increases. It is expected that China's economy will be 70 percent larger than that of the United States by 2050.
According to Dijkgraaf, China has enough challenges where it needs help. For them it will take years to reach the same level of chips usage as in the West. Our policy here is increasingly focussing on not sharing latest inventions with China. ASML, for example, is not allowed to sell the latest chip machines to China. Instead of bargaining with the Chinese, we could also focus on closing a good deal, says Dijkgraaf. ‘Perhaps the West should think about what strategy they can use to connect with the Chinese instead of trying to defeat them.’
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Read the full article in the Reformatorisch Dagblad, 16 November 2019 (in Dutch.)