US tariff measures may boomerang
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.