- No matter who wins the 2020 US presidential election, greater tensions between the US and China can be expected, a Fitch strategist told CNBC.
- Both candidates are “probably going to increase the rhetoric as they head into the election, as that’s always the vote winner,” said Cedric Chehab, global head of country risk at Fitch Solutions.
- He said that under a Trump presidency, tensions would rise much more quickly whereas under a Biden presidency, there would be a more multilateral approach towards addressing some concerns.
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Policy on China has quickly emerged as one of the most contentious issues of the US 2020 presidential election.
Both President Donald Trump and Democratic nominee Joe Biden are intent on using tough talk on China in their verbal brawls.
But no matter who wins the election, greater tensions between the US and China can be expected, Cedric Chehab, global head of country risk at Fitch Solutions told CNBC on Tuesday.
A bipartisan stance on China being a bad actor means heightened tensions between the two sides are expected to broadly impact the Asian region, Chehab said.
“We know they’re probably going to increase the rhetoric as they head into the election, as that’s always the vote winner,” he said, adding that both Trump and Biden could tighten the screws on China after the vote.
Chehab said tensions would escalate more quickly under Trump, whereas under a Biden presidency, there would be a more multilateral approach towards addressing some concerns.
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He pointed out that a contested election may arise especially due to Trump’s criticism of mail-in voting – which will be more prominent this year, as the severity of the COVID-19 pandemic is likely to deter voters from going to the polling booths in person.
Trump has described mail-in ballots as a “nightmare” and said it would lead to widespread fraud, thereby making it difficult to declare who won. That said, he has said he will still be the winner.
“Unless there’s a marginal victory of like 3%-5% by either Biden or Trump, the losing party will likely call into question the elections and this could result in delayed results, rising political unrest, and uncertainty,” Chehab said.
China’s significant contribution to the US economy is highlighted by the fact that it is the third largest export market for US goods (at about $120 billion a year) and the largest source of US imports ($540 billion a year).
Trump’s advisers consider China as an opportunity to portray Biden as deferential to Beijing when he was President Obama’s vice president, while the Biden campaign aims to portray Trump as someone who just talks tough, but has failed to hold China accountable for its response to the virus.
“Trump said he’d get tough on China,” one of Biden’s campaign ads says. “He didn’t get tough. He got played.”