US tar­iff mea­sures may boomerang

China Daily (USA) - - VIEWS -

The United States pro­posed to im­pose ad­di­tional 10 per­cent tar­iffs on $200 bil­lion worth of Chinese goods on Tues­day and thus ex­panded the tar­iff war he launched by im­pos­ing 25 per­cent tar­iff on $34 bil­lion of Chinese im­ports on July 6. How should China deal with the US “trade ter­ror­ism”? Three ex­perts share their views on the is­sue with China Daily’s Liu Jianna. Ex­cerpts fol­low: ations are the best way to re­solve trade dis­putes and a trade war will leave no side un­scathed. So the US should show more sin­cer­ity in set­tling the trade dis­putes through talks. be given spe­cial at­ten­tion, as they have con­trib­uted a lot to the growth of the Chinese econ­omy.

It is im­por­tant there­fore for China to take a firm stand against the US’ hege­monic moves on the one hand and deepen re­form and open­ing-up on the other to deal with the tar­iff war. China should also ex­pe­dite bi­lat­eral and mul­ti­lat­eral trade ne­go­ti­a­tions to fa­cil­i­tate the mak­ing of new trade rules that are po­tent, bind­ing on all par­ties and pro­mote the mul­ti­lat­eral trad­ing sys­tem. be im­mune to the de­struc­tive im­pact of the US tar­iff war, as the Sino-US trade con­flict would un­der­mine the global sup­ply chain and even­tu­ally hurt con­sumers both in China and the US.

Yet for now the im­pact of US tar­iff on China’s econ­omy is largely man­age­able as it ac­counts for a rel­a­tively small part of the to­tal value of bi­lat­eral trade, which was $584 bil­lion last year. Be­sides, the im­pact of the tar­iff war, to a cer­tain ex­tent, will ex­tend to for­eign en­ter­prises be­cause 59.6 per­cent of the Chinese goods tar­geted in the US tar­iff list are made by for­eign en­ter­prises in­clud­ing some US com­pa­nies. In other words, other economies, in­clud­ing the US it­self and its al­lies such as the Euro­pean Union, Ja­pan and Canada, may have to bear the brunt of the US tar­iff war against China.

The spillover of the tar­iff war aside, the Trump ad­min­is­tra­tion may be more con­cerned about how many man­u­fac­tur­ing jobs will re­turn to the US. But US en­ter­prises fo­cus more on prac­ti­cal busi­ness is­sues such as mar­ket de­mand and pro­duc­tion cost. That Har­ley-David­son has de­cided to move part of its op­er­a­tions over­seas in re­sponse to the EU im­pos­ing ad­di­tional tar­iff on US goods ex­plains the con­cerns of some US com­pa­nies. As much as Trump hopes, US man­u­fac­tur­ers may take ac­tion con­trary to his wish­ful think­ing.

This shows the US has started a tar­iff war that may harm other economies but won’t ben­e­fit the US ei­ther. Hope­fully, Trump will re­al­ize that the tar­iff war can­not “make Amer­ica great again”, in­stead it would iso­late the US in the in­ter­na­tional com­mu­nity like never be­fore.

Apart from China, quite a few other economies have also taken coun­ter­mea­sures to Trump’s uni­lat­eral and pro­tec­tion­ist moves.

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