The US-China Trade War

The US-China trade war has been dominating the news for some time; its impact is becoming tangible in the business and political realms alike. What is narrowly described as a trade war is in fact a battle that spans geopolitics and global technology supply chains — one whose reach extends far beyond the US and China and that might substantially change the world as we know it. For the first time in decades, there is a distinct possibility that globalisation will slow or even begin to reverse.

Our public policy team are closely monitoring this issue. Most recently, we partnered with colleagues at The Economist Corporate Network to facilitate two interactive sessions with senior executives in Singapore and Kuala Lumpur. We storyboarded alternate futures on how the US-China trade war might impact firms’ corporate strategy and operations. We did this through a simulation where we asked workshop participants to re-think the strategy of an ASEAN-based US e-commerce firm under two scenarios: an escalation and a de-escalation of the trade war.

The session leveraged our newly established Foresight and Scenario Service, which builds on megatrend analysis, scenario planning and quantitative scenario modelling to help organisations to understand emerging trends, address strategic challenges, capitalise on opportunities and make better decisions. The session also built upon the findings of an upcoming paper that assesses the US-China trade war, which we will be releasing next week. The report includes our original macroeconomic forecasts developed through our new GVAR scenario model.