Crippled by Virus and Facing Economic Ruin, China Folds in Trade War
Viruses, including the now-infamous novel coronavirus, have driven China to the brink of economic disaster. Now, the country is rolling back tariffs on U.S. products as the communist nation’s economy threatens to take a dive.
China’s Thursday decision saw tariff cuts on $75 billion of American imported goods, The Associated Press reported. Among the imports affected are soybeans, pork and auto parts.
Although the move comes as part of a January deal, it’s clear that the Asian powerhouse can no longer safely continue the costly economic war.
This is due in large part to the emergence of 2019-nCoV, a virus that has ballooned to over 28,000 infections in mere months. A costly containment and recovery effort has done little to stem the infection rate.
Currently, more than half of China is in some form of shutdown or quarantine to control the virus, CNBC reported.
The parts of China now under these restrictions account for a whopping 80 percent of the country’s GDP.
This news spooked investors, causing the Shanghai Composite Index to take an ugly dive as uncertainty swirled over the virus’ potential.
While many of the shutdowns are scheduled to end mid-February, there is speculation that the quarantines could be extended if the virus is not controlled to a manageable extent.
On top of coronavirus fears, another pathogen is also at work undermining the Chinese economy.
African swine fever, which does not affect humans, has decimated China’s pig herds.
The disease does not have a cure and readily spreads among swine, so farmers are forced to destroy their hogs in an effort to control the often fatal illness.
As pork is the most popular meat in China, the purges have resulted in a major spike in prices. Citizens living under the communist regime are now turning to alternative meats — including dog.
For those planning to fall back on chicken, there’s even more heartbreak to be found.
China was gut-punched a second time as H5N1, more commonly known as bird flu, broke out in a chicken farm. After thousands of the birds died, an additional 17,000 were culled to halt the disease’s spread.
Food security in China is a major issue, with several generations still alive that saw firsthand the leading communist party’s policies result in deadly famine.
Easier access to American pork and soybeans will likely ease these worries.
For the Chinese, it’s been an incredibly rough few months. As the fear of coronavirus still has much of China in the dark behind a quarantine order, it’s unclear when the country will see brighter days.