U.S.-China trade war poses the biggest risk to global stability, says IMF official

  1. The International Monetary Fund(IMF) official has said that trade war between the United States and China poses the greatest risk to global stability.The ongoing trade war has affected the flow of billions of dollars of goods between the two countries.
  2. Trade war is a situation where countries restrict each other’s trade by imposing tariffs or quota on imports.US had started imposing tariffs on as much as 25% on Chinese imports.China too responded with retaliatory tariffs of 25% on US goods including on soybean,automobiles and marine products such as lobsters.
  3. Currently,theUnited States and China are in the final stages of completing a trade deal.The trade agreement under discussion will lead to(a)lower tariffs for American goods (b)ease restrictions on American goods such as on farms,automobile and chemical products (c)lower barriers that would allow American companies to operating from China and (d)Reduce trade gap as China will be buying more goods from US.In return for Chinese concessions,US will also remove all the trade sanctions which it had imposed on China since 2018.
  4. The International Monetary Fund (IMF) is an international organization headquartered in Washington,US.It consists of 189 countries.It was formed in 1944 at the Bretton Woods Conference.It has been established to (a)foster global monetary cooperation (b)secure financial stability, (c)facilitate international trade (d)promote high employment (e) sustainable economic growth and (f)reduce poverty around the world.