The trade war between the US and China will not only damage the economy of the first two world economic powers, but its collateral effect will hit European growth hard .
The Bank of Spain expects this impact to be 0.2% of the GDP of the euro zone due to its high degree of commercial opening. In addition, the agency warns of "significant" adverse effects on trust that will lead to an increase in investment risk premiums .
After an initial analysis of the first tariff measures implemented or announced, the report considers that China will suffer more the effect on its economic growth due to its greater dependence on US imports. As a whole, the commercial battle will subtract 0.25% from world GDP, equivalent to more than 278 billion dollars.
China would take the worst part with a loss of growth of 0.38%, while in the case of the US it would be 0.26%. "The biggest impact on the Chinese economy reflects the fact that US tariffs affect a volume of imports in relation to their GDP higher than the Chinese authorities have retaliated," the regulator details.
Since March 2018, both countries have been involved in a diplomatic conflict that has resulted in successive tax increases at the border to goods of different types. Last year the measures adopted reached 45% of US imports from China and 55% of imports from the Asian country with North American origin.
In May 2019, the conflict intensified with the approval of new tariff increase decisions that will cover total imports of Chinese products into the US and almost 75% of US products.
"In addition to the tariff measures, there have also been announcements about possible restrictions on the exchange of technology, which, however, have not yet materialized in specific actions," explains the Bank of Spain in relation to the possible veto that the US wants to approve on the Chinese giant Huawei.
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