ZCZC
BCN-19
CHINA-US-SINGAPORE-TRADE
Ex-US Treasury chief warns of ‘economic iron curtain’
SINGAPORE, Nov 7, 2018 (BSS/AFP) – Former US Treasury secretary Henry
Paulson warned Wednesday of the risk of an “economic iron curtain” unless the
United States and China step up efforts to ease soaring trade tensions.
Washington and Beijing have been locked for months in a stand-off over US
President Donald Trump’s move to end what he describes as years of unfair
trade practices by China.
He has imposed new tariffs on Chinese imports, prompting Beijing to
retaliate with its own levies on US products, and continued the offensive by
boosting military support for rival Taiwan and denouncing China’s human
rights record.
In a speech in Singapore as Americans voted in midterm elections set to
deliver a stinging rebuke to Trump, Paulson warned that “economic tensions
are reaching a breaking point” between Washington and Beijing.
“Today this region must look warily at the prospect that what until now
has been a healthy strategic competition could tip into a full-blown Cold
War,” said Paulson, who served under Republican president George W. Bush.
Paulson, who backed Trump’s Democratic rival Hillary Clinton in the 2016
presidential election, warned that decades of US-China economic integration
appeared to be going into reverse, which could have broad impact.
“I fear that big parts of the global economy will be closed off to free
flow of investment and trade,” he said.
“I now see the prospect of an economic iron curtain — one that throws up
new walls on each side and unmakes the global economy, as we have known it.”
The Iron Curtain was the term used to describe the political and
ideological barrier that divided western Europe from the communist Soviet
Union during the Cold War.
Tensions have gone beyond trade in recent weeks as the midterms
approached.
Trump has cast China as a villain set on bringing him down, and in a
closely-watched speech earlier this month Vice President Mike Pence vowed to
challenge the Asian giant on multiple fronts and accused Beijing of seeking
to interfere in the polls.
There have been signs of ties improving in some areas, with the State
Department announcing this week that top-level US-China security talks will
take place in Washington Friday.
Nevertheless Paulson, speaking at the Bloomberg New Economy Forum, warned:
“We are in for a long winter in US-China relations.”
BSS/AFP/HR/1100