Slow China economy hurts tariff fight
BEIJING — As China considers ways to retaliate against President Donald Trump’s mounting tariffs, it has increasingly acknowledged it must first address its main obstacle to punching back: its own slumping economy.
Chinese officials Wednesday vowed to respond with measures of their own if Trump follows through on his threat to put 10 percent tariffs on $300 billion in Chinese imports a year. If Trump enacts the tariffs next month, as he said he would do Thursday, the costs would rise for nearly everything China ships to the U.S.
On Friday, China’s Ministry of Commerce, which is heavily involved in the country’s trade policy, said it would “take necessary counter measures to resolutely defend the core interests of the country and the fundamental interests of the people.”
There are several things China could do. It could call for a boycott of U.S. goods or stop buying Boeing planes. It could devalue its currency, which would in effect partially nullify U.S. tariffs. It could make life much harder for American business and executives in China or it could exercise its power over key parts of the global supply chain, like its dominance over key manufacturing minerals called rare earths.
Chinese officials have signaled in recent weeks that tackling sluggish growth is a necessity for prevailing in the trade war, especially as it looks to drag on for months or perhaps years.