The official news agency Xinhua unveiled a warning heralded by the Chinese Ministry of Culture and Tourism on June 4th. The latter is urging Chinese citizens to carefully assess the risks before travelling to the United States, stating the country presents security threats entwined with a growing harassment of Chinese nationals on American soil. The Ministry indeed cited “frequent” shootings, robbery and theft, without providing further details. In addition, state-run China Central Television broadcasted the Foreign Ministry’s words; “Recently U.S. law enforcement agencies have repeatedly harassed Chinese citizens visiting the United States through exit and entry inspections, door-to-door interviews and other means.” The Ministry also published a warning directed towards Chinese citizens studying in the U.S.
Washington has not provided any official response yet. The veracity of those warnings can nevertheless be questioned as the FBI reported major U.S. crime rates have been falling, with a decrease in violent crimes, murders, robberies and thefts. The warnings released by China (or PRC) must be recognized in the broader context of the ongoing trade war between Beijing and Washington, as Foreign Ministry spokesman Geng Shuang confirmed they were a “response to current events.” According to Bloomberg’s economists, China is once again using tourism as an economic weapon, expanding the trade war to a new domain.
The trade war began as a tariff dispute roughly a year ago, and expanded to multinational companies as well as education and tourism sectors. Fears about further escalation have rattled investors and hit stock markets already, and will cost billions to both economies while slowing down global growth. Beijing and Washington still have many leverage options to further this trade war, which could be evaluated as a zero-sum game. It will only weaken the two economies, lower the standards of living of people and threaten free trade and world organizations such as the World Trade Organization (WTO). The escalation of tension between the PRC and the U.S. jeopardizes the opportunity for dialogue and cooperation between them, making the eventual realization of the Thucydides trap – an inevitable military conflict between the two – more probable, reinforced by the current situation with Taiwan. As International Monetary Fund (IMF) leader Christine Lagarde stated, “the immediate priority is to resolve trade disputes quickly.” Dialogue must thus be reestablished between Washington and Beijing in order to avoid any further protectionist measure and to remove the existing trade barriers and tariffs.
The aforementioned trade war began after the Trump government’s investigation into Chinese trade policies led to the implementation of tariffs, to which Beijing retaliated in kind. After a short glimmer of hopes in December, the U.S. furthered those tariffs on manifold Chinese products, and the PRC retaliated once again with tariff hikes. The U.S. then expanded the range of the war to multinational companies by banning the Chinese company Huawei in May, putting it on the US Commerce Department “Entity List.” Beijing responded by creating its own blacklist – the “Unreliable Entity List” – although the companies on the list have not been disclosed yet. With the warning to Chinese tourists and students in the U.S., China has taken the lingering economic confrontation to a new level.
The global economic order developed since 1947 is seriously imperiled by the ongoing trade war between the two largest economies in the world. The trade war has expanded to many economic domains, such as tourism and education, recently. The global economy as a whole is at risk, and international economic organizations (such as the WTO) experience barriers to functionality as a result. The trade war thus deepens animosity and distrust between the U.S. and China, reducing opportunities for dialogue and increasing the risks of a military conflict. All protectionist measures should be annulled under the supervision of the WTO to put an end to the trade dispute.
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