Interview, Conference Presentation
The great brawl: China v America
The EconomistDonald Trump, Friedrich Merz, Betty Webb, Rosie Bloor, Don Wineland, Tom Nuttall, Anne Rowe
- The incoming German government is projected to assume office in the first week of May, with Friedrich Merz expected to become chancellor and the coalition agreement serving as the four-year governing blueprint.
- Merz is anticipated to pursue an economic turnaround and restore Germany's foreign policy standing, which could rapidly shift public opinion, while the administration intends to devote all efforts to restoring growth despite risks from U.S. tariffs potentially dwarfing domestic measures.
- Merz is scheduled to play a prominent role at the NATO summit in June, where allies are expected to respond positively, and Germany is set to fulfill defense obligations.
- The U.S.-China trade conflict is described as in early stages with a low probability of a near-term deal, though China may improve EU relations or leverage trade diversification and export restrictions on items like germanium, antimony, and gallium.
- Global supply chains are expected to undergo reshaping due to potential retaliatory measures such as placing U.S. firms on an "unreliable entities list," while U.S. exporters may need to address trade rerouting through countries like Vietnam and Indonesia.
- Long-term outlooks suggest China could become a global stability source if the U.S. erodes the trade system, though the conflict's duration is uncertain and could intensify without Chinese capitulation.
- Significant risks include German economic recovery being undone by U.S. tariffs, a sudden escalation of the dispute into a Taiwan crisis causing severe global disruption, and a fear that the situation could become increasingly volatile.
- Betty Webb is expected to serve as a guide at Bletchley Park for the coming term, focusing on educating the younger generation about the site and warning against the dangers of fascism.