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Analysts and economists have predicted that the impact of the return of the US-Chinese currency war after the devaluation of the yuan by China, reaching record levels in the UAE markets, will be limited and indirect.
The sharp decline of the Chinese yuan, which has reached its lowest level in 11 years, will reduce the cost of imports of Chinese goods to the United Arab Emirates, pointing out that importers will benefit from this reduction, which will affect the prices of these products on the market. the market. Local. They predicted that oil prices would be the most affected by the trade war between the United States and China, in the context of the trade war, because of the difficulty of rising oil prices above 70 dollars during the next phase.
Chinese authorities on Monday allowed the local currency (yuan) to fall below 7 yuan for every US dollar for the first time since the 2008 global financial crisis.
The United States reacted by accusing China of currency manipulation for the first time since 1994, reinforcing the signs of a worsening trade war between the world's two largest economies, clouding the global economic outlook and the fuel demand.
The decline in the yuan is contributing to higher exports as it reduces the costs of Chinese products and reduces imports, especially crude oil, the world's largest importer.
Expected result
Osama al-Rahma, vice president of the Banking and Financial Institutions Group and managing director of Alfardan Exchange, said the "fierce" monetary war was the expected result of trade tensions between China and the United States, of the pressure on the Chinese economy, the world's second largest economy, and US attempts to reduce interest rates. The devaluation of the currency, a process that began with quantitative easing in the context of the recent financial crisis.
He pointed out that the UAE's monetary sector has a proven discipline and experience allowing it to cover the effects of trade conflicts that occur globally, resulting in a fluctuations in exchange rates by buying as much currency as needed only to cope with large exchange rate fluctuations and maintain the stability of this vital sector. Which serves a large segment of state residents.
"The repercussions of the currency and price war will not benefit global economies, especially emerging economies, and markets are awaiting the results of the Chinese central bank's decision to sell $ 4.3 billion worth of money." bonds to slow the value of the currency against the dollar, "he said. He pointed out that the increasing complexity of the system and the global economic interests in today's world have forced countries to use economic instruments such as protectionism and other means of pressure-to-size. strategically, while keeping pace with this trade war if no agreement is reached.
Positive effect
Economic expert Wadah al-Taha said that the devaluation of the Chinese yuan would have a direct positive impact in favor of the UAE, with regard to the volume of trade between the two countries, the cost of products imported from China being lower in the coming period.
He pointed out that the decline of the Chinese currency meant that more goods and services imported from China could be obtained before the price was fixed or paid at a price lower than the purchase of the same amount of goods, in waiting for that part of the decline to affect the prices of domestic goods About 3 months from now. Tariq al-Rifai, director of the Corum Center for Strategic Studies in London, said the devaluation of the Chinese currency revealed Beijing's weakness in its trade war with the United States and that its main tool against Tax was to devalue his currency.
A major option
Pino Pillai, managing director of M Orient International Exhibitions, a Chinese company, said the devaluation of the yuan was for the Chinese government a major option to counter the US-led trade war against the Chinese economy, giving thus an equal advantage to Chinese exports. About 15%.
"The Chinese economy and stability are export-oriented, and it is natural that the Chinese government will please exporters." I think China's launch of the Belts and Roads Initiative is a strong sign that the Chinese government was waiting for an economic confrontation with America. " Today, China's share of trade with the Belts and Roads Initiative has reached about 25%, which means that China is preparing to counter the effects of US tariffs on its exports. .
Global growth
Ali Al-Sadiq, an economist, pointed out that the serious consequences of the US-China trade war on the global economy, which is currently going through a difficult phase, will not lead to prosperity in world trade because trade between the countries of the prosperous world on a free international market in which every currency is valued.
He added that if China took advantage of the devaluation of its currency to increase its exports to the United States and attract the US consumer first, China would be affected by the devaluation of its currency, because the prices of Goods imported by China, especially commodities, would increase due to the decline of the yuan and would also have inflation rates. He pointed out that the impact of the China-US trade war on the UAE is limited at the moment and that its effects on the stock market are limited, but that it could have the effect to increase Chinese exports to the UAE.
Re-export
Amjad Nasr, the Islamic financial adviser, acknowledged that the impact of the Sino-US trade war on the UAE was limited, pointing out that this effect could be felt in the long run due to the declining growth rates of the economy. world trade, the UAE being an important center for trade and re-export trade, in particular. He added that China would emerge victorious from the bone trade war, stressing that Beijing wants to increase its exports to the US market and sell most of it. Sales of goods would recover sharply after the devaluation of the currency. The statement
Wednesday, August 7, 2019
Analysts and economists have predicted that the impact of the return of the US-Chinese currency war after the devaluation of the yuan by China, reaching record levels in the UAE markets, will be limited and indirect.
The sharp decline of the Chinese yuan, which has reached its lowest level in 11 years, will reduce the cost of imports of Chinese goods to the United Arab Emirates, pointing out that importers will benefit from this reduction, which will affect the prices of these products on the market. the market. Local. They predicted that oil prices would be the most affected by the trade war between the United States and China, in the context of the trade war, because of the difficulty of rising oil prices above 70 dollars during the next phase.
Chinese authorities on Monday allowed the local currency (yuan) to fall below 7 yuan for every US dollar for the first time since the 2008 global financial crisis.
The United States reacted by accusing China of currency manipulation for the first time since 1994, reinforcing the signs of a worsening trade war between the world's two largest economies, clouding the global economic outlook and the fuel demand.
The decline in the yuan is contributing to higher exports as it reduces the costs of Chinese products and reduces imports, especially crude oil, the world's largest importer.
Expected result
Osama al-Rahma, vice president of the Banking and Financial Institutions Group and managing director of Alfardan Exchange, said the "fierce" monetary war was the expected result of trade tensions between China and the United States, of the pressure on the Chinese economy, the world's second largest economy, and US attempts to reduce interest rates. The devaluation of the currency, a process that began with quantitative easing in the context of the recent financial crisis.
He pointed out that the UAE's monetary sector has a proven discipline and experience allowing it to cover the effects of trade conflicts that occur globally, resulting in a fluctuations in exchange rates by buying as much currency as needed only to cope with large exchange rate fluctuations and maintain the stability of this vital sector. Which serves a large segment of state residents.
"The repercussions of the currency and price war will not benefit global economies, especially emerging economies, and markets are awaiting the results of the Chinese central bank's decision to sell $ 4.3 billion worth of money." bonds to slow the value of the currency against the dollar, "he said. He pointed out that the increasing complexity of the system and the global economic interests in today's world have forced countries to use economic instruments such as protectionism and other means of pressure-to-size. strategically, while keeping pace with this trade war if no agreement is reached.
Positive effect
Economic expert Wadah al-Taha said that the devaluation of the Chinese yuan would have a direct positive impact in favor of the UAE, with regard to the volume of trade between the two countries, the cost of products imported from China being lower in the coming period.
He pointed out that the decline of the Chinese currency meant that more goods and services imported from China could be obtained before the price was fixed or paid at a price lower than the purchase of the same amount of goods, in waiting for that part of the decline to affect the prices of domestic goods About 3 months from now. Tariq al-Rifai, director of the Corum Center for Strategic Studies in London, said the devaluation of the Chinese currency revealed Beijing's weakness in its trade war with the United States and that its main tool against Tax was to devalue his currency.
A major option
Pino Pillai, managing director of M Orient International Exhibitions, a Chinese company, said the devaluation of the yuan was for the Chinese government a major option to counter the US-led trade war against the Chinese economy, giving thus an equal advantage to Chinese exports. About 15%.
"The Chinese economy and stability are export-oriented, and it is natural that the Chinese government will please exporters." I think China's launch of the Belts and Roads Initiative is a strong sign that the Chinese government was waiting for an economic confrontation with America. " Today, China's share of trade with the Belts and Roads Initiative has reached about 25%, which means that China is preparing to counter the effects of US tariffs on its exports. .
Global growth
Ali Al-Sadiq, an economist, pointed out that the serious consequences of the US-China trade war on the global economy, which is currently going through a difficult phase, will not lead to prosperity in world trade because trade between the countries of the prosperous world on a free international market in which every currency is valued.
He added that if China took advantage of the devaluation of its currency to increase its exports to the United States and attract the US consumer first, China would be affected by the devaluation of its currency, because the prices of Goods imported by China, especially commodities, would increase due to the decline of the yuan and would also have inflation rates. He pointed out that the impact of the China-US trade war on the UAE is limited at the moment and that its effects on the stock market are limited, but that it could have the effect to increase Chinese exports to the UAE.
Re-export
Amjad Nasr, the Islamic financial adviser, acknowledged that the impact of the Sino-US trade war on the UAE was limited, noting that this effect could be felt in the long run due to the declining growth rates of the economy. world trade, the UAE being an important center for trade and re-export trade, in particular. He added that China would emerge victorious from the bone trade war, stressing that Beijing wants to increase its exports to the US market and sell most of it. Sales of goods would recover sharply after the devaluation of the currency. The statement
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