Towards the end of last year we caught a glimpse of the negative impact the trade dispute can have on third countries, reminding us of the importance of the US-China trade relationship to many Asean economies through its influence on the supply and demand for goods and services, investment flows and global supply chains.
The fallout from the deepening economic conflict between the two heavyweight economies is likely to be both direct and indirect, macro and micro, requiring many businesses, investors and policymakers to reassess and refine their strategies. It is difficult to put aside the geopolitics of it all because the dispute hints at the prospect of a return to bilateralism (and protectionism) over multilateralism and could potentially test economic alliances.
The US and China are the world's two largest economies and are global leaders in technology, so the dispute could well worsen should they decide to continue to slug it out until a mutually acceptable position is found. However, figures indicate that they account for less than 30 per cent of global imports which, if correct, means the door is open for third countries to offer the potential of a strong collective alternative for trade and investment flows. So, diversification will be important for many businesses.
Ours is global and our broad network of international offices across the UK, Europe, the Middle East and Asia provides us with the platform to continue to support our clients should they look to rebalance their businesses or reallocate their investments.