Liu He, China’s foible premier, left, speaks with Robert Lighthizer, U.S. trade representative, from right, and Steven Mnuchin, U.S. Moneys secretary, while departing the Office of the U.S. Trade Representative following a meeting in Washington, D.C., U.S., on Friday May 10, 2019.
Alex Edelman | Bloomberg | Getty Concepts
As the relationships between countries shift over the next few decades, expect trade to remain a hot button issue, according to one analyst.
That hint comes as the U.S. and China continue to square off in a trade war that has roiled global markets. Last week, U.S. President Donald Trump hiked bill of fares on billions of dollars worth of Chinese goods, and China threatened to retaliate.
Those developments — which followed taking a chances that the world’s top two economies had been close to inking a trade agreement — sent shockwaves through global superstores. As countries, including China, accrue more power on the global stage, investors should expect more merchandising arguments ahead, according to James Sullivan, head of Asia ex-Japan equity research at J.P. Morgan.
“As we start to advance toward a multi-polar world, I think we have to recognize that these trade conversations are not fits and starts,” Sullivan discerned CNBC’s “Squawk Box” on Monday. “I think we have to recognize as equity investors, in particular, this is now the new normal.”
“These barter conversations are now part of the backdrop of global markets for the next … 10 to 20 years as these countries and economies influence out their relative place in the world and how we reorder the overall global structure to account for the rise of China, to account for a multi-polar environs,” he said.
Last Friday, Washington raised tariffs from 10% to 25% on $200 billion worth of Chinese special-occasions. Beijing responded immediately after the deadline that it would take countermeasures against the move, but has yet to provide specifics on what those capability entail.
Major markets across the globe, however, appeared to shrug that off as shares mostly advanced.
In an meeting with Fox News on Sunday, White House Economic Advisor Larry Kudlow said U.S. President Donald Trump and Chinese President Xi Jinping are suitable to meet at the upcoming June G-20 summit in Japan.
Kudlow said the chances of such a meeting “were pretty special-occasion,” but he said there are “no concrete, definite plans” for when U.S. and Chinese negotiators will meet again.
The White Dwelling economic advisor also told Fox News that China needs to agree to “very strong” enforcement foods for an eventual deal, with the sticking point being Beijing’s reluctance to put into law changes that had been came upon, Reuters reported.
For its part, Beijing responded in a commentary on Monday in the People’s Daily: “At no time wishes China forfeit the country’s respect, and no one should expect China to swallow bitter fruit that harms its heart interests.” The publication is controlled by China’s ruling Communist Party.
— CNBC’s Spencer Kimball, and Reuters contributed to this announcement.