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On May 13th, China announced its retaliation to the May 10th US hike in tariffs on $200 billion of Chinese imports.
China had earlier imposed additional tariffs on $60 billion worth of U.S. imports, the rates of additional tariffs on some of the products will now be increased to 25%, 20%, and 10%, according to a statement by the Customs Tariff Commission of the State Council.
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The 25% tariffs on $200 billion worth of Chinese goods came into effect on May 13th, and Trump praised them on Twitter. He warned China against a retaliation, because it would only get worse.
There is no reason for the U.S. Consumer to pay the Tariffs, which take effect on China today. This has been proven recently when only 4 points were paid by the U.S., 21 points by China because China subsidizes product to such a large degree. Also, the Tariffs can be…..
— Donald J. Trump (@realDonaldTrump) May 13, 2019
..There will be nobody left in China to do business with. Very bad for China, very good for USA! But China has taken so advantage of the U.S. for so many years, that they are way ahead (Our Presidents did not do the job). Therefore, China should not retaliate-will only get worse!
— Donald J. Trump (@realDonaldTrump) May 13, 2019
Trump on May 14th, claimed that “we can make a deal with China tomorrow, before their companies start leaving so as not to lose USA business, but the last time we were close they wanted to renegotiate the deal. No way! We are in a much better position now than any deal we could have made. Will be taking in so that they will be more competitive for USA buyers. We are now a much bigger economy than China, and have substantially increased in size since the great 2016 Election. We are the “piggy bank” that everyone wants to raid and take advantage of. NO MORE!”
Then he tweeted that the US would strike a deal with China “when the time is right,” praising his friendship with Chinese President Xi Jinping being “unlimited.”
In remarks on May 14th, Chinese Foreign Ministry spokesperson Gen Shuang confirmed the Chinese retaliation and said that raising tariffs would, ultimately, solve nothing.
“The US threatened to raise tariffs on $200 billion worth of Chinese goods from 10 percent to 25 percent, triggering strong international responses and fluctuations in financial markets. China told the world that it was not the first time the US made such threat. China’s position was clear, and the US was well aware of it. We called on the US to change its behavior, meet the Chinese side half way so that we could make a deal beneficial to both countries. The international community highly commended China for the cool-headed and constructive attitude.”
He further said that China always sought to deal with the US and others calmly, while the US appeared impulsive.
“In dealing with a capricious US and its maximum pressures, China has been calm all along. We advise the US to listen to the call of the international community and people from various sectors, carefully weigh its gains and losses, and get back on the right track as soon as possible. On the basis of mutual respect, we advise the US to make concerted efforts with China for an agreement beneficial to both sides.”
To a question, whether it was true what US President Donald Trump said that the negotiations were 95% there when China walked back on some of its commitments, Gen Shuang said that it wasn’t China, but rather the US who walked back.
“First, it is only natural to have differences in a negotiation because, by definition, it is a process of discussions. The differences we have are exactly the reason why we are continuing the talks. Now with the talks still going on and a deal yet to be concluded, how can China be blamed for breaking commitments?
Second, if you look at previous media coverage on the past 11 rounds of trade talks, you will see clearly which side has been flip-flopping all along. In May last year, China and the US reached consensus on trade and issued a joint statement in Washington, D.C. But just a few days after that, the US abandoned our agreement. In December last year, the two sides reached consensus on the value of China’s purchases from the US, but in the following talks the US wantonly rejected the agreement and asked for more. It is never China that backtracks on and breaks its commitments.
Third, it takes the joint efforts from both sides to make a deal. China honors promises and has demonstrated the utmost sincerity and good will in the talks. In the spirit of mutual respect, equality and good faith, we hope the US can meet us half way and strive for an agreement that benefits both sides.”
On the possibility that the US may introduce tariffs on a further $300 billion of Chinese imports, Gen Shuang said that the Trump administration should not underestimate “China’s determination and will to safeguard its rights and interests. What happened in the past has proved a simple fact: China doesn’t want a trade war, but we are not afraid of fighting one. If someone brings the war to our doorstep, we will fight to the end.”
Despite ordering the US Trade department to ” begin the process of raising tariffs on essentially all remaining imports from China,” he also said that the final decision on whether to impose tariffs hasn’t been yet made.
Trump plans to meet Chinese President Xi Jinping at the end of June at a G20 meeting in Japan. He said that “maybe something will happen. We’re going to be meeting, as you know, at the G20 in Japan and that’ll be, I think, probably a very fruitful meeting.”
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