The Warrior Word is featuring a new weekly financial column from finance aficionado 11th Grader Eliot De Paz. Each week De Paz-it will give his take and advice on the economic climate.
While you may be unaware of the G20 summit and its purpose, the outcome of the conference has major ramifications on your wallet.
The G20 Summit is an annual meeting between twenty countries to secure the economic well being of their nations. This year’s G20 meeting was highly anticipated, as the United States was hoping to mend its relationship with China and de-escalate their trade war.
The United States’ main issue with China is their repeated violation of intellectual property laws. China is constantly infringing on the ideas of American corporations, manufacturing the goods, and selling them back to the United States at a lower cost, thus undercutting the American groups. As a result of this, the United States has a high trade deficit with China, meaning they import more from China than China imports from them.
The main goal of the United States for the conference was to reach an agreement with China resolving this trade issue. Unfortunately, after a night of negotiations, the United States and China were unable to come to a compromise. Despite this, China agreed to open their markets to American automobiles soon after the conference.
These problems may seem like they would justify the trade war that the United States declared against China. In reality, the trade war is a much larger risk to the American economy than it is to China’s because of China’s shady business practices. Many analysts believe that the trade war will make Chinese companies less respectful to intellectual property. Bottom line: expect a much heavier burden on your wallet in the coming months.