KO 대한민국
베어링 인베스트먼트 인스티튜트
거시경제 및 지정학

Showdown in Osaka and the Fate of the World

2019년6월21일 - 3 분 읽기

Osaka will be a showdown less between Trump and Xi than between the forces of globalization … rising nationalism that may steer us toward a sharper confrontation.

With last week’s Central bank decisions behind us, all eyes are on the face-to-face meeting between Donald Trump and Xi Jinping that will determine the fate of the world. That may sound a little breathless, but it feels like we are approaching one of those moments that will linger in future history books when things either got a little better or turned much worse.

Much of the week ahead is entirely predictable: markets will bounce nervously as both sides try to set expectations with strategic press leaks. After they talk, the two leaders will emerge to shake hands for the cameras, issue a statement and likely designate teams to continue the process.

What remains far more crucial about this meeting is whether it helps steer the increasingly complex relationship back on a familiar course or whether it stirs winds and currents that sweep us further off into uncharted waters. Osaka will be billed as a showdown between Trump and Xi, but the real confrontation that looms is between the forces of globalization that have shaped the world economy for three decades and the rising nationalism steering us toward a potentially sharper confrontation.

Most of the recent analysis has centered on the tariffs that each side has placed on the other and their impact on American farmers and Chinese manufacturers. But the actual tariffs are just not that important in and of themselves and will hardly knock either country’s economic path off course.

China’s exports to the United States are about 4% of its GDP and actually much less if you strip out components imported from elsewhere. Tariffs on U.S. exports to China are significant to anyone who makes planes or grows soybeans or slaughters cows, but altogether they represent less than 1% of the American economy.  

If talks fail to strike a temporary truce, fresh tariffs on Chinese toys and clothing and consumer goods will hurt U.S. retailers. But they’ll barely dent public optimism. If anything, they might offer a small boost to counteract the recent price weakness that has the Fed worried.  

Xi’s team has not only drawn up a careful retaliatory list of U.S. targets to minimize damage to the Chinese economy, but they have actually lowered tariffs on similar imports from other countries to soften the blow. It’s a boon for Canada’s lobster industry over Maine’s (unless you’re the lobster). 

This means that Osaka is much less about any tariffs than the direction of the entire U.S.-China relationship. This has taken a much more complicated turn in the last six weeks.

Chess masters urge young players to see the whole board, rather than focusing solely on a few pieces in play. Instead of futilely wrangling over a single issue, diplomats have long resorted to expanding the conversation and bringing leverage from other areas. Henry Kissinger, for example, famously tried to link Soviet restraint in the Third World to concessions in nuclear and economic negotiations. Those results were mixed, but we appear to be entering a period of similarly complex linkages between Beijing and Washington.  

Trump finds the intricacies of these connections appealing, as Mexico learned this month when immigration issues were tied directly to tariffs. Xi seems willing to broaden the discussions, too.  

Through most of the last year, tariff discussions have been proceeding remarkably isolated with so many other issues on the table. Recall that China essentially ignored the arrest of a Huawei executive in Canada following the G-20 Summit in Argentina last December.

When trade negotiations collapsed in early May, however, Trump blacklisted Huawei itself. National security concerns have been simmering for years, but the timing to increase pressure on Beijing over tariffs was unmistakable.

Just as interesting was Xi’s unexpected scheduling of a visit to North Korea last week, which may represent his attempt to supplant Trump’s unraveling effort or advance an issue where they are largely aligned. In any case, it allows them both to frame the trade standoff amid a broader range of issues.

Trump has so far restrained from any escalatory language regarding recent protests in Hong Kong, but he will be mindful that those events have put Xi on the defensive. Other issues like the South China Seas, human rights and Taiwanese politics have yet to take center stage in their talks, but the spotlight is widening quickly.  The escalating tensions between the U.S. and Iran will be high on everyone’s mind, too. 

So as the leaders emerge from their meeting, there will likely be clear signals about how they intend to manage the relationship across this broadening set of dimensions. Will they manage to link a U.S. compromise on trade to a Chinese breakthrough in Korea? Will recent Chinese signals that it will resist currency devaluation lead to a softer tone from Vice President Mike Pence whenever he delivers his long postponed speech on China policy?  Or has the souring mood in both countries made it impossible to patch up an interim truce? 

For investors, any more cooperative signals will indicate that both sides still want to protect important economic benefits of their relationship even if the trade static persists. An impasse, however, will open an era of significant political and diplomatic uncertainty that will make all the worries over tariffs seem like a quaint annoyance.

Watch closely.

해당 자료에 제시된 전망은 작성 시 시장에 대한 베어링자산운용의 견해를 바탕으로 작성되었습니다. 작성된 이후, 다양한 요인에 따라 사전통지 없이 내용이 변경될 수 있습니다. 또한 본 자료에서 언급된 투자 결과, 포트폴리오 구성 및 사례는 단순 참고용이며, 결코 미래 투자 성과 혹은 미래 포트폴리오 구성을 보장하지 않습니다. 투자에는 위험이 수반됩니다. 투자와 투자에서 발생하는 향후 소득 가치는 하락 또는 상승할 수 있으며, 투자 수익은 보장되지 않습니다. 과거성과는 현재 또는 미래성과를 보장하지 않습니다. 

더 읽어보기

또한 본 자료에서 언급된 투자 결과, 포트폴리오 구성 및 사례는 단순 참고용이며, 결코 미래 투자 성과 혹은 미래 포트폴리오 구성을 보장하지 않습니다. 실제 투자의 구성, 규모 및 위험은 본 자료에서 제시된 사례와 현저히 다를 수 있으며, 투자의 향후 수익 혹은 손실 여부에 대해 보증 및 보장하지 않습니다. 환율 변동은 투자가치에 영향을 미칠 수 있습니다. 잠재 투자자들은 본 자료에 언급된 펀드의 자세한 내용과 구체적인 위험요인에 관하여 투자설명서를 반드시 읽어 보시기 바랍니다.
베어링은 전 세계 베어링 계열사의 자산운용 및 관련 사업의 상표명입니다. Barings LLC, Barings Securities LLC, Barings (U.K.) Limited, Barings Global Advisers Limited, Barings Australia Pty Ltd, Barings Japan Limited,Baring Asset Management Limited, Baring International Investment Limited, Baring Fund Managers Limited, Baring International Fund Managers (Ireland) Limited, Baring Asset Management (Asia) Limited, Baring SICE (Taiwan) Limited, Baring Asset Management Switzerland Sarl, Baring Asset Management Korea Limited 등은 Barings LLC의 금융서비스 계열사로(단독으로는 “계열사”) “베어링”으로 통칭합니다.
본 자료는 정보 제공의 목적으로 작성된 것이며, 특정 상품이나 서비스의 매매를 제안하거나 권유하기 위한 것이 아닙니다. 본 자료의 내용은 독자의 투자목적, 재무상태 또는 구체적인 니즈를 고려하지 않고 작성되었습니다. 따라서, 본 자료는 투자자문, 권유, 리서치 또는 특정 증권, 상품, 투자, 투자전략 등의 적합성 또는 적절성에 대한 권고가 아니며 그러한 행위로 인식되어서도 안됩니다. 본 자료는 투자 전망 또는 예측으로 해석되어서는 안됩니다.
달리 명시되지 않는 한, 본 자료에 제시된 견해는 베어링의 것입니다. 작성 당시 알려진 사실을 바탕으로 신의 성실하게 작성 되었으며 사전통지 없이 변경될 수 있습니다. 개별 포트폴리오 운용팀은 본 자료에 제시된 것과 다른 견해를 가질 수 있으며 고객별로 다른 투자 결정을 내릴 수 있습니다. 본 자료의 일부 내용은 베어링이 신뢰할 만 하다고 판단하는 출처에서 획득한 정보를 근거로 작성되었습니다. 본 자료에 수록된 정보의 정확성을 확보하기 위해 최선의 노력을 기울였으나, 베어링은 정보의 정확성, 완전성 및 적절성을 명시적 또는 묵시적으로 보증하거나 보장하지 않습니다.
본 자료에 언급된 서비스, 증권, 투자 또는 상품은 잠재투자자에게 적합하지 않을 수 있으며 해당 관할권에서 제공되지 않을 수 있습니다. 본 자료의 저작권은 베어링에 있습니다. 본 자료에 제시된 정보는 개인용도로 사용될 수 있으나 베어링의 동의 없이 변형, 복제 또는 배포할 수 없습니다.



베어링자산운용은 당사 웹사이트 사용자들에게 최적화된 웹 경험을 제공하고자 쿠키를 사용합니다.
베어링 웹사이트를 이용함으로써, 당사의 쿠키정책법적 & 개인정보고지사항에 동의하는 것으로 간주합니다.