Breaking the Shackles: Reshaping Global Manufacturing Through US-China Trade Policies

Global trade and economic growth are witnessing number of ill-effects and have been severely hampered by the trade disputes between US and China. These conflicts have far-reaching effects that go beyond the parties involved and affect the global economy. This conflict is hampering the production process and availability around many countries. Capital flow from these two main countries is playing a crucial role throughout the globe. This paper will use qualitative analysis to bring the positive and negatives effects of this trade war on the global economy. The paper looks at how multinational investment trends in China and Southeast Asia are affected by the trade tensions between the United States and China. The paper examines data on firm-level greenfield foreign direct investment using a dynamic compositional method. The paper highlights American companies pulling out, shifting their attention to Southeast-Asia to lessen reliance on the Chinese market, while European companies are expanding their investments in China to increase market penetration. The paper comes up with the fact that this transformation reflects broader developments in global business strategy in the face of economic and geopolitical upheavals.