It is inevitable that a trade war between China and the US will escalate into a new cold war, and the confrontation will press Beijing and Washington to form their own alliances and divide the world into their spheres of influence – a deja vu of the old cold war days when the US and the former Soviet Union vied for global dominance.
The US is using tariffs as a tool to pressure Beijing to alter its state-led economic model and “unfair” trade practices. At the heart of US policy is the issue of China’s state-owned enterprises – they are implementing China’s Made in China 2025 strategies, they are the vanguard of expanding Chinese influence in Asia and Africa, and they are the main beneficiaries of technology “transfers” from the US and EU.