The reports are in and we can now start to measure the damage the trade war is doing to the American and Chinese economies.
The trade war launched by the Trump administration has hit the export industries of both the US and China. Chinese exports to the US fell 16% in August as Trump’s tariffs have weakened demand for Chinese goods in the US. US exports to China took an even more serious hit, dropping by 22% in August. These significant and sudden drops suggest that exporters in both countries have been suffering as a result of the trade war.
The US is China’s largest export partner, and the relationship between the two just lost a lot of value. Chinese exports to the US fell by as much as $44.4 billion (16%) in August, a quick acceleration from the 6.5% drop reported in July. US exports to China lost a greater percentage of their value, but US exports to China are valued at significantly less than the US imports from China.
At the moment it looks like the trade war will certainly escalate. Should more tit-for-tat tariffs come, the damage to exporters will be intensified and the Chinese economy in particular will slow down. The US added 15% in duties to $112 billion worth of Chinese imports on September 1st.