By Nirmal P. Acharya

Now the United States and China are completely at odds. The US keeps exerting extreme pressure on China in all kinds of ways, while the official response from China is to stand firm and see it through.

A direct confrontation is inevitable and a winner will surely emerge. When the outcome is revealed, the world order will undergo a significant change. As a neighboring country of China, Nepal cannot avoid the question of "which side to take".

Therefore, we might as well conduct a systematic review of the Sino-U.S. tariff war to help us figure out which side to take.

First, there is a prevailing general judgment on the current international situation that it is undergoing a major transformation unseen in a century. There will be intense collisions and profound changes, and there will definitely be irreconcilable contradictions that eventually escalate into conflicts or even wars. The major transformation unseen in a century also implies the replacement and reconfiguration of the world order and the alternation and transformation of the status of major powers. From this perspective, the current tariff wars faced by the world are, in a broad sense, a node in the process of this major transformation unseen in a century, and a narrow sense, they are the continuation of the numerous contradictions and conflicts between China and the United States that emerged since the United States proposed strategic eastward shift. They are also a necessary process for the fundamental change in the strategic status of China and the United States, and one of the landmark events marking the transition from strategic stalemate to strategic counteroffensive in their struggle.

Second, in general terms, this tariff war is not a disaster for China, nor is it a bad thing. On the contrary, it can even be said to be an important strategic opportunity for China. Today's China is no longer the China of Trump's era 1.0. China's military strength, technological innovation capabilities and economic strength have all become the dominant forces in the world. Under such circumstances where the power dynamics have undergone substantive changes, the tariff war waged by China is an opportunity to change the dominance of the war. China has clearly demonstrated its determination to seize the opportunity to actively counterattack the United States, striving for the initiative and dominance in the struggle, seizing the strategic high ground, and launching a strategic counterattack at an opportune time.

Third, the initiation of the global tariff war by the United States has a profound background rooted in its domestic contradictions and international predicaments. This tariff war is interrelated with the Russo-Ukrainian War, the Israeli-Palestinian Conflict, and the tensions between the United States and Iran. It is also linked to the conflicts between the United States and the European Union, the United Kingdom, and Japan. It can be discerned that this tariff war is a means by which the United States, unable to resolve its domestic contradictions and crises domestically, has sought to transfer and shift them globally. Just as the United States transferred the crisis to the global stage after the subprime mortgage crisis in 2008, and even more severely than that, the United States is simultaneously exporting and shifting the crisis globally while establishing a new imperial order by imposing hegemonic taxes on the entire world to resolve its domestic contradictions and crises. Therefore, launching the global tariff war is a necessity for the United States to transfer its domestic contradictions and crises to the global stage.

Fourth, this tariff war is likely to be a crucial juncture for the United States. Currently, the United States is in a desperate gambler's state. Trump wants to win the entire game by intimidating the world and China. If the United States wins this global tariff war, it can delay the situation for a while. If it loses this tariff war, domestic contradictions and crises will erupt in a big way, and the hegemony of the United States will be shaken or even decline. China believes that at this moment, it is likely to be a golden opportunity to shake the hegemony of the United States. It will resolutely counterattack and fight back, and determine the outcome in one battle. It will not think like in 2008 that "saving the United States is saving China" and help the United States overcome difficulties.

Fifth, China may consider that this tariff war should be an important opportunity for challenging the hegemony of the US dollar and making the RMB a major global currency. The hegemony of the US dollar is not only the most crucial and sharp tool for the United States to reap global wealth but also a corrosive agent that leads the United States towards financialization, bubble formation, hollowing out and decadence. It is a double-edged sword. Trump wants this sharp scythe to harvest the whole world, wants manufacturing to return to the United States, and wants to charge high hegemony taxes to the whole world. Such extreme greed will cause the United States to lose its national credit, become the enemy of all countries, make everyone start to consider discarding the US dollar and choosing other currencies and shake the foundation of the US dollar.

Sixth, in November 2017, during Trump's first term in office, China and the United States signed a major agreement worth 253.5 billion US dollars. However, Trump did not express gratitude for this. Instead, he began to launch a fierce attack on China on the plane as he was leaving China. Subsequently, he launched the largest-scale trade war in history against China, instigated the Hong Kong riots, formulated the "China Action Plan", arrested Huawei executive Meng Wanzhou, and launched high-tech and biological warfare against China. When Trump launched a larger and more vicious tariff war against China again, China had no illusions about the United States anymore. Instead, it directly retaliated against the United States. China cannot fall into the same trap twice.

Seventh, what the world is facing now is not only a tariff war but also a political war. The so-called global tariff war is not only about collecting taxes globally but more importantly about collecting taxes from China. It aims to undermine China's industrial chain through tariffs and lock in China's technological innovation process through the chip embargo. For Trump, his purpose is to prevent China's development and rise process, to prevent China from surpassing the United States, with a distinct political intention and obvious geostrategic purpose. Therefore, China will not merely regard this tariff war as a tariff war to fight but will treat it as a political war that concerns the survival and existence of the country. China will mobilize its national system to deal with this tariff war.

Eighth, this tariff war will help China break away from its economic dependence on the United States. For a long time, China's economy has been basically subordinate and dependent on the American economic system, remaining on the periphery, the bottom layer and the low end of the American economic system. Although China has been catching up and has gained certain strength, in the eyes of Americans, China is just a yokel who works for the United States. Now China aims to make the United States understand through this tariff war that China's manufacturing industry is the trump card, that the economic and financialization and the hollowing out of manufacturing in the United States are dependent on China rather than the other way around, and that China is the country with the ultimate power when it comes to manufacturing. China has begun to counterattack the United States with its powerful manufacturing industry, making Americans accept the fact that China is already an economically and technologically advanced country with complete economic and financial sovereignty, forcing the United States to recognize China's strength and status.

Ninth, for a long time, China has been perceived as being afraid of the United States pulling China out of the market. It is believed that once China is disconnected from the United States, the Chinese economy will suffer unbearable damage. However, the mainstream view in Chinese society currently holds that: disconnecting from the United States might be the best way for China to break away from the infiltration, control, exploitation and plundering by the United States. It is a once-in-a-lifetime opportunity for China. Only by completely disconnecting from the United States and its allies can China completely escape the exploitation of the US dollar, truly achieve independence and autonomy, truly realize economic and financial sovereignty independence, be free from the sanctions and tariff threats imposed by the United States, and resist the long-term propaganda war, ideological war and color revolution conducted by the United States against China. The Chinese authorities and the public have already shown that they are not afraid of disconnecting from the United States.

Tenth, the United States has a huge consumer market and uses it to manipulate China and other countries. China has realized that the current tariff war is a golden opportunity for China to develop the world's largest consumer market with a population of 1.4 billion and regain global consumer dominance. China will establish a global high-quality and high-standard consumer market through measures such as the appreciation of the RMB, increasing the income level of the people, and transferring funds from the East to the West. It will break away from its dependence on the consumer markets of the United States and Europe and enable its people to benefit from the huge wealth they have created. They will no longer exchange their own high-quality products for useless American green paper, nor will they have to serve as American workers. Recently, the Vice President of the United States openly referred to China as "peasants", which has also stimulated China's pride. China will no longer be willing to endure the situation where it has to manufacture everything that the United States and Western countries need and then be humiliated by them.

Eleventh, for a long time, the US dollar has been anchored to gold, then to oil, and now to US treasury bonds. Now, perhaps it is the time to establish a new global monetary system with China's manufacturing as the anchor. Since China's manufacturing is a major global traded good, China has begun to link and tie its manufacturing products exports to the RMB. All or most of China's major commodities are settled in RMB, or through barter trade, or settled in the local currencies of non-US countries, without using the US dollar for settlement. Gradually, the US dollar is being marginalized from the global trade system, and a global RMB settlement system is being established. Of course, this is a long-term process of substitution and evolution.

Twelfth, the tariff war is also an opportunity for China to strictly control the outflow of wealth. Over the past decade, a large amount of wealth created in China has been transferred out of the country by some powerful individuals and capitalists in various ways. Some were transferred out under the guise of investment, while others were secretly transferred out through various illegal underground banks. This has led to a massive loss of wealth in China. China will take advantage of the strategic window provided by the tariff war and adopt more effective measures and means to achieve social fairness and common prosperity.

Thirteenth, China will also consider using the tariff war to accelerate the recovery of Taiwan. The tariff war initiated by the United States has united all Chinese people and made them stand united as one, playing a role in conducting war mobilization for the recovery of Taiwan.

The above is the overall pattern of the Sino-US tariff war. As for the outcome, it's up to readers to judge. As for Nepal's stance, it's also up to readers to decide.