November’s G20 meeting is set to stoke fresh tensions between the US and China, which have already seen a range of retaliatory trade tariffs slapped on various imports and exports from the two economic superpowers.

The global economy has found itself volatile as a result, with various emerging markets heavily reliant on some of the connecting supply chains that now have added tariffs. Many countries are worried because there is no sign of trade disputes cooling any time soon.

One of the major risks is that investors worldwide start to lose confidence, and recent results from indicators such as the equities markets serve as a reminder that the longer the trade war continues, the more downturn that could result.

Worries that a full-on trade war could develop as the situation escalates is beginning to hit home for China, which has seen its economy growth slowing. The Shanghai Index has dropped almost 30% in 2018 alone.

This has led to International Monetary Fund (IMF) Managing Director Christine Lagarde stepping in to provide some mediation, but this has yet to bear fruit.

Lagarde said that there must be a move to “de-escalate” tensions, or there are likely to be further economic consequences globally down the line. This has seen the IMF scale down its growth forecasts in its World Economic Outlook from 3.9% to 3.7% compared to how they viewed the situation back in April.

The trade conflicts are effecting countries such as Australia, whose reliance on certain imports and struggle against the strengthening US dollar have seen its economy’s growth forecasts reduce from 2.9% in 2018 to just 2.8% next year. Amid fears that an economic slowdown could take hold in many countries reliant on smoother supply chains, the increasing tariffs should continue to cause the economy problems.

With relations between the US and China currently at a low point, given their relatively warm correspondence when former US President Barack Obama was still in charge, the news of a large Chinese surplus is not set to help matters.

The surplus hit a record $34.1bn last month as exports to the US grew by 13%, despite many tariffs kicking in. This suggests that the measures have not stopped Chinese export intentions for the time being.

There is also an undercurrent of discontent from the US now that China has devalued the yuan to help stimulate growth. The US believes that China has dropped its currency by 10% to be able to increase its exports, although China strenuously denies this allegation.

With US President Trump looking inward and introducing more protectionist measures, there are concerns that no global leader in charge can turn the tide away from insular politics, which is harming the global market at present.

The rhetoric from both sides is ramping up, as US Vice-President Mike Pence accused China of harboring “malign” intent, saying that he felt its current conduct is of a worse nature than the alleged Russian meddling into the 2016 US elections.

With all this in mind, these topics will dominate the G20 next month as many participants call for a solution.