‘China will win any trade war’

Country’s media rattles sabres over stand-off with Washington on punitive tariff increases

Traders work at the New York Stock Exchange. After a chaotic trading day on Wednesday, the Dow opened higher yesterday. Markets continue to be on edge due to concerns over a potential trade war between the US and China
Traders work at the New York Stock Exchange. After a chaotic trading day on Wednesday, the Dow opened higher yesterday. Markets continue to be on edge due to concerns over a potential trade war between the US and China
Image: Drew Angerer/Getty Images/AFP

China has never surrendered to external pressure and it will win any trade war with the United States, the nation’s state media stressed in the hours after the world’s two top economies targeted each other with planned steep tariffs.

In Washington, US administration officials continued to seek to allay market fears of a trade war, and expressed willingness to negotiate a resolution with China.

The trade actions against China were not intended to punish any industries or the markets, but Beijing should shoulder the blame for any hit to the US economy, White House economic adviser Larry Kudlow said yesterday.

“Our intention is not to punish anybody. Our intention is to open markets and investments and lower barriers – that’s the deal,” he said.

“Any damage to our economy comes from China’s restrictive practices . . . blame China, don’t blame Trump.

“There’s going to be some back and forth, but there’s also some negotiations,” Kudlow said.

“I think we are going to get a deal over a period of time,” he said in an interview with Fox Business Network.

China’a ambassador to the US, Cui Tiankai, said in Washington on Wednesday that Beijing preferred to resolve the trade dispute through negotiations, but China’s official mouthpieces took a tougher stance.

The ruling Communist Party’s People’s Daily newspaper said Beijing’s quick counter-move after Washington announced new tariffs this week had caught the Americans off guard. “Within 24 hours of the US publishing its list, China drew its sword, and with the same strength and to the same scale, counterattacked quickly, fiercely and with determination,” the paper said yesterday.

“The confidence to know that will win the trade war comes from the scale of [China’s] consumer market,” the paper said, noting that China’s market potential was incomparable to other economies. Many American consumer product and industrial companies see the Chinese market as a big source for future growth given the rise in the number of people joining both the middle class and the wealthier levels of Chinese society.

The United States’ proposed list of $50-billion in duties on Chinese goods is aimed at forcing Beijing to address what Washington says is deeply entrenched theft of US intellectual property and forced technology transfer from US companies.
China hit back with its own threatened tariffs on US imports including soybeans, planes, cars, whisky and chemicals.

The official Xinhua news agency said late on Wednesday that the US tariffs proposal would cost the United States dearly.

“China will not be afraid or back down if a trade war is unavoidable. The country has never surrendered to external pressure, and it will not surrender this time either,” Xinhua said.

Shortly after US President Donald Trump’s administration issued its list, China’s ambassador to the World Trade Organisation urged all of the trade body’s members to join with China to counter US trade abuses.

“China’s counter-tariffs are a spectacular way of standing up to America’s bullying tactics, not only for itself, but for other countries threatened by the United States’ new trade policies,” the nationalist Global Times said in an editorial yesterday.

China’s commerce ministry said yesterday it had initiated a WTO dispute resolution procedure over US tariffs on its imports of steel and aluminum.

The ministry said the US measures were not for maintaining national security, as Washington has said, but rather were in aid of trade protectionism.

Beijing says Washington is the aggressor and is spurring global protectionism.

However, China’s trading partners have complained for years that it abuses WTO rules, and practises unfair industrial policies at home that lock foreign companies out of crucial sectors with the intent of creating domestic champions.

China has repeatedly said it will open up sectors such as financial services, including promises to the Trump administration last year that it would give full and prompt market access to US payment network operators.

But despite a 2012 WTO ruling that China was discriminating against foreign payment card companies, no US firm has yet been granted a licence. – Reuters