The Rising

The Rising covers how changes in the environment impact business, politics, and technology.

US-China Trade War Has Severe Implications On The Environment

2 min read
Trade War

As of July 2018, the United States and China became embroiled in a trade war, imposing hundreds of billions of dollars worth of tariffs on one another. While the immediate environmental effects of the trade war have yet to be seen, it is very likely that the environment will end up being a victim.

Executive Director Erik Solheim of the UN Environment Program warned that the impending trade war would be “very bad for the environment because you waste resources rather than using them effectively”. With additional tariffs enacted both sides this month, a settlement seems less possible than ever before. And so Solheim’s ominous prediction now seems increasingly possible.

Chinese Soybean Tariffs Threaten Amazonian Rainforests

Chinese tariffs on American soybean exports have cut them in half. Brazil, already a supplier of about half the soybean exports, is the most likely candidate to replace the gap left by slashed American exports. Experts estimate 13 million more hectares of Amazonian forest land would be needed to accommodate increased demand.

In the context of the recent Brazilian presidential elections, the future of Amazonian forestlands is bleak. Increased Chinese demands for Brazilian soybean exports would likely have the full cooperation of newly elected president Jair Bolsonaro, a strong supporter of Brazil’s agricultural industry a vocal critic of the country’s environmental agency.

Rare Earth Metals

With the United States’s recent blows to China’s tech giant Huawei, China’s response is still in the cards. Many fear that China could turn to restrictions on rare earth exports. In fact, China’s state-run newspaper The Daily threatened to cut off rare earth exports to the United States. With 70% of global rare earth production and 80% of US rare earth imports coming from China, restrictions would leave American companies hard-pressed find new sources.

The environmental consequences of Chinese rare earth mining have garnered notoriety worldwide. Cutting off imports from China would lead to an inevitable growth of global rare earth mining. This could lead to an increase in global environmental effects not unlike those seen in China.

Conclusions

With the US-China trade war disrupting the world’s supply chains, Solheim’s predictions don’t look too far off. The trade war has unequivocally drifted the world away from efficient production and distribution of resources. Additionally, it seems inevitable that the trade war will end up having a dire impact on the global environment.

With the trade war’s end far in sight, we can only wait and see to what it extent it goes.