**Weathering the Tariff War – Standard Chartered**
*Posted on BitcoinEthereumNews.com*
—
Peak fear surrounding the US-China tariff war appears to be behind us. According to Standard Chartered’s economists, tariffs are expected to remain at current levels through 2026. Key factors such as diversification, upgrading, and innovation will help China maintain its export competitiveness despite ongoing challenges.
### Navigating the Storm
The latest US-China trade agreement marks a significant de-escalation of tensions between the two countries. The deal features mutual concessions on tariffs, export controls, and other restrictions, and is intended to last for one year.
China’s rare earth controls have proven to be an effective bargaining tool and are likely to remain so for at least a few more years. Standard Chartered expects tariffs to stay at their current levels through 2026 as part of the baseline scenario. Future negotiations will likely continue to focus on pragmatic, quid pro quo arrangements.
### Resilience in China’s Exports
China’s exports have remained resilient this year despite higher US tariffs. Meanwhile, imports have been relatively soft compared with other Asian countries.
As a result, net exports contributed significantly to China’s economic growth as of Q3, offsetting weak domestic demand. The country’s current account (C/A) surplus has reached its highest level since 2011.
This resilience in exports is driven by more than just trans-shipment and front-loading. Diversification, upgrading, and innovation are key factors enhancing China’s competitiveness on the global stage.
On the import side, softness is not only due to weak demand but also reduced import intensity. This is a consequence of domestic economic rebalancing and increasing self-reliance in key inputs.
### Productivity and Future Outlook
China’s total factor productivity (TFP) growth has resumed an upward trend in recent years after a prolonged slowdown in the 2010s. Efficiency gains—likely spurred by automation and digitalisation—have had a disinflationary effect, supporting China’s export strength, especially in the manufacturing sector.
With the 15th Five Year Plan (FYP) prioritizing technology development and promoting services exports, Standard Chartered expects China’s current account surplus to remain sizable.
Accordingly, the bank has revised up its current account forecasts for the years 2025 to 2027 to 3.3%, 2.5%, and 2% of GDP respectively, up from previous estimates of 2.8%,…
—
*For more insights on global trade and economic forecasts, stay tuned to BitcoinEthereumNews.com.*
https://bitcoinethereumnews.com/finance/weathering-the-tariff-war-standard-chartered/