As free #trade could bring decline in marginal benefits&rise in marginal costs,it's not a sure policy choice. Here are several key points from the latest special report by cf40 senior fellow Zhang Bin on the #Macroeconomic Policy Choice in the Context of #China-US Trade Dispute.
While,to date, the negative effects of protectionist measures taken by US on China have been within acceptable range, it’s necessary for #Chinese policymakers to consider the proper responsive measures, which could include:
1) fiscal and monetary policies should focus on maintaining a stable aggregate demand. Specifically, the report suggests that China adopt a floating #exchange rate regime, leave sufficient space for monetary policies, and maintain a moderate #inflation.
2) reducing the effective import #tax rate; 3) continuing to promote ‘opening up’ along with the ongoing China-US trade negotiations; 4) speeding up the time in which the service sector will be opened up to both foreign and domestic markets.
Beyond these measures, the report also elaborates the effects of the #trade dispute on China's #economy since its start. To obtain the full report, connect to the download page here🤓 cf40.org.cn/uploads/ZB2019…
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