China: "Both sides suffer" if a trade war breaks out
(Baonghean.vn) - According to Xinhua News Agency, Beijing vowed to respond as soon as Washington's tax increase takes effect.
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| According to China, the US-China trade war will not benefit any country, including the US. Illustration photo: Internet. |
China's Ministry of Commerce warned on July 5 that the US is "opening fire at the entire world, including itself" by threatening to raise tariffs, and that China will fight back as soon as the tariffs take effect, as the move will damage global supply chains.
The tariffs on $34 billion worth of Chinese goods are scheduled to take effect at 12:01 p.m. on July 6, Washington time, or 12:01 p.m. Beijing time, the U.S. Trade Representative confirmed in an email on July 5, as reported by Bloomberg.
Chinese Commerce Ministry spokesman Gao Feng also said on Thursday that about 59 percent of the Chinese goods subject to sanctions were produced in China by foreign-invested enterprises.
“If this list takes effect on July 6, the US will effectively impose tariffs on both Chinese and foreign companies, including US companies,” Gao said. “The US measures will fundamentally destroy global supply chains and value chains.”
China's General Administration of Customs also announced that the country will raise tariffs on US goods immediately after the US tariffs take effect.
Their comments came a day before the US plans to impose a 25% tariff on Chinese goods from July 6.
Meanwhile, the Financial News of the People's Bank of China also quoted an interview with Guo Shuqing - Party Secretary of the Bank and Chairman of the China Banking and Insurance Regulatory Commission, saying that the country's financial system remains stable. Systemic risks are under control thanks to stable social finance growth and increased profits in companies on the sanction list in the first half of the year.
Responding to a question about the impact of US-China trade tensions on the global financial system, he said: “China’s economic fundamentals suggest that a significant depreciation of the yuan is unlikely.”
The escalating trade rift between the world's two largest economies has raised concerns about a full-blown trade war that could freeze the global economy.
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| US President Donald Trump and Chinese President Xi Jinping. Photo: Internet |
China has insisted it will not “fire the first shot” in the trade war with the US. “However, if the US continues to raise tariffs, China will be forced to respond to protect the core interests of the country and the interests of the people,” Mr. Gao said.
He also reiterated that China will not bow to threats, and will not change its determination to defend free trade and the multilateral system.
China is not the one to provoke a rift that could escalate into a trade war, according to Chinese Foreign Ministry spokesman Geng Shuang. “A trade war will not benefit any country, but will harm the interests of industries and consumers,” Geng said at a press conference.
Chinese experts, meanwhile, asserted that the US administration's stance in launching a trade war has challenged the world order in an unprecedented way.
“We have no choice but to raise prices in the US market as a result of the Trump administration’s tariff hike,” said Qi Jun, chairman of the Beijing-based China Construction Machinery Association. In 2017, China shipped $2.4 billion worth of construction machinery to the US market, accounting for 10% of China’s total exports in this sector.
The Trump administration's decision to increase tariffs on China will be a major blow to the hard work and efforts of China and many other countries amid a slow and fragile global economic recovery, according to Chen Wenling, chief economist at the China Center for International Economic Exchanges.
According to Ms. Chen, the US government's strategy completely disregards the rules of the World Trade Organization, as it arbitrarily imposes tariffs on other countries based on its own laws and expands the conflict through threats and retaliation.
In a report on trade restrictions among G20 countries, the WTO earlier on July 4 asserted that trade barriers erected by major economies could destroy the global economic recovery. WTO Director-General Roberto Azevedo said in a statement that the continued escalation posed a serious threat to growth and recovery in all countries, and the organization is beginning to recognize this problem as reflected in a number of indicators that are trending upwards.
