China vows to fight US ‘at any cost’ as trade spat worsens
The Commerce Ministry said China does not want a trade war – but is not afraid to fight one.
China has vowed to fight the US “at any cost” after President Donald Trump proposed slapping an additional 100 billion US dollars (£71 billion) in tariffs on Chinese goods in an escalating trade dispute between the world’s two largest economies.
Mr Trump’s surprise move to instruct the US Trade Representative to consider the additional tariffs came a day after Beijing announced plans to tax 50 billion dollars (£35 billion) in American products, including soybeans and small aircraft, in response to a US move this week to add tariffs on 50 billion dollars in Chinese imports.
In Beijing, the Commerce Ministry said China does not want a trade war – but is not afraid to fight one.
NEWS: USTR Lighthizer: “President Trump is proposing an appropriate response to China’s recent threat of new tariffs.” Read the full statement here: https://t.co/Q6pqcRuYlw— USTR (@USTradeRep) April 5, 2018
“China will dedicate itself to the end and at any cost and will definitely fight back firmly” if the US persists in its “protectionism,” the ministry said in a statement.
Mr Trump’s proposal intensified what was already shaping up to be the biggest trade battle since the Second World War.
Global financial markets had fallen sharply as the world’s two biggest economies squared off over Beijing’s aggressive trade tactics. But they had calmed down on Wednesday and Thursday amid hopes the US and China would find a diplomatic solution.
Instead, the White House announced after the markets closed on Thursday that Mr Trump had instructed the Office of the United States Trade Representative to consider whether 100 billion dollars of additional tariffs would be appropriate and, if so, to identify which products they should apply to.
He has also instructed his secretary of agriculture “to implement a plan to protect our farmers and agricultural interests”.
“China’s illicit trade practices – ignored for years by Washington – have destroyed thousands of American factories and millions of American jobs,” Mr Trump said in a statement announcing the decision.
The latest escalation comes after the US on Tuesday said it would impose 25% duties on 50 billion dollars of imports from China, and China quickly retaliated by listing 50 billion dollars of products that it could hit with its own 25% tariffs.
The Chinese list included soybeans, the biggest US export to China, and aircraft up to 45 tons in weight. Also on the list were American beef, whiskey, passenger vehicles and industrial chemicals.
Earlier in the week, Beijing announced separate import duties on 3 billion dollars (£2.1 billion) of US goods in response to the Trump administration’s duties on all steel and aluminium imports, including from China.
US officials have sought to downplay the threat of a broader trade dispute, saying a negotiated outcome is still possible. But economists warn that the tit-for-tat moves bear the hallmarks of a classic trade rift that could escalate. And already, the tensions have rattled global stock markets.
US Trade Representative Robert Lighthizer called China’s move “unjustified” and said Mr Trump’s proposal was an “appropriate response to China’s recent threat of new tariffs.”
“Such measures would undoubtedly cause further harm to American workers, farmers, and businesses,” he said in a statement.
“Under these circumstances, the president is right to ask for additional appropriate action to obtain the elimination of the unfair acts, policies, and practices identified in USTR’s report.”
China’s Commerce Ministry said it must “adopt new countermeasures” to protect the interests of the Chinese people – but it did not announce any specific measures.
The clash reflects the tension between Mr Trump’s promises to narrow a US trade deficit with China that stood at 375.2 billion dollars (£267.8 billion) in goods last year and China’s ruling Communist Party’s development ambitions.