Forbes (25/10/2018) - China has more to lose in the Trade War game, and, therefore, it will have no choice but to concede to Washington’s demands. But it must lose the trade war gracefully, as was the case with the US-Japan trade war back in the 1980s.

“When China entered the war, the question became ‘who will lose more’," says Renee Mu, a currency analyst for DailyFX. “That's why China tried hard to avoid the war, until the first US tariff move on $34 billion Chinese goods went into effect on July 6. “

Once, the ‘first shot” of the trade war was fired, it set off three scenarios, according to Mu.

• A ‘win-win’ scenario: the US and China could reach a consensus on major trade disputes, and the impact to both economies would be limited. This has failed.
• A ‘lose-lose more’ scenario: disputes could stay within the area of trade, but the US and China remain unable to reach a deal to avoid major tariffs.
•   A ‘lose more-lose more’ scenario: political issues could get involved in trade disputes and expand the scope of the disputes. Like the intensification of South China Sea disputes.

“Based on US Vice President Mike Pence's recent speech, the trade war is moving from scenario 2 to scenario 3,” adds Mu. “The longer China stays in this trade war, the more it will lose; same for the US. China's slowing growth may make it less resilient than before: the third-quarter GDP came in at 6.5% today, weaker than 6.6% expected.”

Read more at https://www.forbes.com/sites/panosmourdoukoutas/2018/10/25/america-should-let-china-lose-the-trade-war-gracefully/#26828b911842