What is the concept of “Thucydides Trap”? Discuss the causes and consequences of the current conditions of trade wars.

When a rising power causes fear in an established power which escalates toward war, the condition is known as Thucydides Trap. Graham Tillett Allison coined the term for the first time. The term appeared�on April 6, 2017, the day of U.S. President�Donald Trump’s meeting with Chinese President�Xi Jinping.
Causes of the current conditions of the trade war:

  • China�s aggressive capture in south and East China Sea which US see as a prohibition from moving freely in international waters.
  • After joining the World Trade Organization in 2001, China has gained the benefits of the global trading and investment system but it failed to meet its obligations.
  • China has gained an unfair advantage through intellectual-property theft, forced technology transfers and subsidies for domestic firms.
  • China is becoming authoritarian.

Consequences of Current tensions:

  • A new stage of de-globalization will surely come if this continues.
  • There are chances of division of the global economy into two incompatible economic blocs.
  • The trade in goods, services, capital, labour, technology and data would be severely restricted.
  • There will be a slowdown in economic growth according to the World Economic Situation and prospect report. India will also get impacted according to WESP with a growth rate of 7.1% in 2019.

If this war continues, a future economy will be inhabitable where China and the US separately control access to crucial technologies. Everyone will have to choose, and the world may well enter a long process of de-globalization.


Leave a Reply

Your email address will not be published. Required fields are marked *