Macroscope | In a warring world economy split into US vs China blocs, there can be no winners
- As the divide into two ecosystems of economic and trade activities deepens, business costs increase, efficiency falls – and everyone in the global economy loses
It was alarming to hear a recent conversation between experts from the United States and China discussing the risk of unconstrained rivalry between the two nations leading to catastrophe. Yet that rivalry is fast becoming more entrenched – a development as dangerous as it is ominous.
The issue, according the centre’s president Wang Huiyao, is whether the world’s two largest economies can escape the fate of military conflict.
It may be that the prospect of mutually assured destruction will deter conflict (as was the case with the US and the former Soviet Union) but, aside from the risk of fatal accidents during a policy of brinkmanship, the sheer waste of energy and resources involved is inexcusable.
As Hung Tran, a senior fellow at the Atlantic Council’s GeoEconomics Centre and former International Monetary Fund and Institute of International Finance official, noted in a recent analysis, the US and China are competing “across economic, trade, technology, cybersecurity, military and geopolitical domains”.
