The EU is one of the most economically developed regions in the world. Economic integration has strengthened the EU’s economy. However, it has not completely recovered from the 2008 financial crisis. In addition, the sovereign debt crisis weakened the EU’s GDP growth. Furthermore, high unemployment and refugee problems have raised questions regarding the EU’s credibility. The people’s nationalist sentiment is rising. UK’s Brexit is the result of nationalism. In fact, nationalism is also spreading in other parts of the world. “The resurgence of economic nationalism threatens to derail seven decades of progress toward a more open global economy not only in EU.” (Alogoskoufis, 2017). The main victims of Trump’s trade barriers and steel tariffs are its allies. That made the EU uneasy and it stated that it would impose retaliatory tariffs on steel and motorcycle imports from the United States to rebalance bilateral trade. The value of the affected goods was 3.5 billion U.S. dollars. Trump’s withdrawal from the TPP, negotiating NAFTA and tax reform policies all show his protectionism, which will attract companies to return to the US and prevent too much investment in other economies, especially emerging economies. China is the EU’s largest trading partner. China’s huge market has enabled the EU to increase exports. China and the EU are in a mutually beneficial, win-win relationship in certain areas. The UK disregarded the US’s opposition and joined AIIB. After that, other EU member states joined AIIB, which has helped the internationalisation of the RMB. However, no permanent friends, only permanent interests. The EU does not recognise China’s market economy status and complains to the WTO about Chinese technology licensing rules in order to prevent the increase in China’s trade competitiveness.

Conclusion

This essay analysed the economic growth of the world’s largest economies, the US and China, from three perspectives; policies, trade, and population. Although China is the second largest economy in the world, its economic growth depends on manufacturing, exports and cheap labour. This is not a good economic structure in the long term. However, China is implementing structural reforms to ensure its competitiveness in the future. The GDP growth rate of US rose in recent years because of Trump’s tax reform policy, as it created capital backflow and increased employment and domestic consumption. However, the US is at risk of trade isolationism because it withdrew from the TPP and used hegemony in NAFTA negotiations, due to Trump’s economic nationalism and protectionism. The EU is one of the world’s most important economies, however, its economic growth is weak due to the financial crisis and the sovereign debt crisis. In addition, the rising nationalism in EU member states has had an impact on the EU’s system