Unrest in Hong Kong and the U.S.-China Trade War

Kevin Rudd on CNBC Squawk Box

ASPI President Kevin Rudd joined CNBC’s Squawk Box for a discussion on the unrest in Hong Kong and the U.S.-China trade war.

Rudd advises that the unrest in Hong Kong has developed into a “political management problem,” and notes that there is an incipient spillover effect on the financial sector in mainland China due to a fall in business confidence. Yet, Rudd maintains that there is only a “negligible prospect that China will send in troops or paramilitaries in order to control this.” On the question of if this will play into a U.S. advantage on the trade negotiating table, Rudd thinks not. “In Beijing’s perspective, this is seen through an entirely different lens, a local national security lens,” advises Rudd.

On the U.S.-China trade war, Rudd points out he thinks there will be a deal due to overwhelming interests for both sides. Rudd suspects a change in the Chinese perception of their negotiating position due to what is unfolding in Washington today with the beginning of impeachment proceedings. Rudd also notes that, “China is now insisting that there be some reduction in tariffs associated with a phase one deal, a ‘skinny deal’ and before that was not a precondition.” Rudd expresses the view that the U.S. and China will still reach a deal, but there are now “new degrees of difficulty.”

Watch the full interview on CNBC.