This is where a world trade war begins

In late 2009, with world recession bringing out the worst in economies, and after many great financial stimulus campaigns, China came out with new conditions for bidders of Chinese government procurements. It now demands that companies bidding for government tenders will have to have intellectual properties (IPs like patents and trademarks) originating from China. What it means is that foreign companies will have to register their IPs in China first, and preferably even relocate their R & D to China before they can qualify for Chinese government tenders. This must be one of those new defense strategy that the Chinese are so familiar about; Sun Zhu war strategy. China might have foresaw the unreeling of the world economies! They are perhaps pre-empting the collapse of the world economy. With the big economies reeling from economic stagnation, any form of trade protection will easily start a trade war. Indeed, one has already started.

To make it worse, Google said it will withdraw from the China market come April 2010 after telling the world that its site has been hacked and the Chinese government putting up censorship requirements on its operation. There was also the issue of intellectual property thefts. The China market seems has to be a no go area for foreigners. China's priority seems to be to safeguarding its own economy first, and does not care about what happens to the rest of the world. With China expecting to be the second largest economy in the world comes 2011, whatever happens in China will greatly affect the recovering of the rest of the world’s economy. Already, China is winding down its ownership of US treasury papers in early 2010, with the effect of causing the value of the dollar to be destabilized, and followed by a rise in oil prices, the rest of the world can only just watch by. Is China factoring in the fall of the dollar and the collapse of the US economy, or is it more concerned with its own financial stimulus plan which has to be dis-continued? Perhaps bringing some funds back to China and help propping up its domestic economy is a safer bet?

However way we look at it, 2010 could end with great upheavals, if not in the Americas, then perhaps in the EU. There is just too much rot in the developed countries and very little solutions to cure those ills. Over in the US, job creation just seems to be unsustainable. There is money in the banks, but nobody dares to borrow for fear of not being able to repay loans. As a result, most industries are just opting to sustain themselves by hiring workers only as a last resort and by contracting workers on a monthly basis. With the major economies stagnating, and some economies on the brink of insolvency, and when shove comes to push, there is a real danger that economic walls will be the only option. But if a trade war indeed comes about, then when looking back, we will surely have to nail its cause to the housing crisis back in the US in mid 2008. Will we learn any lesson then? Not likely! Its laissez faire as usual!