[Source / Observer Network, Ruan Jiaqi]
Trump's tariff policies have sparked waves of doubt and counterattacks globally, with China's immediate strong countermeasures drawing particular attention.
"China has swiftly responded after the U.S. imposed tariffs, showing that it has been well-prepared since 2018," reported the Hong Kong-based South China Morning Post on July 7, citing analysts. They pointed out that China's counterattack against U.S. tariff policies was "stronger than expected." This was a tactical result of intensive planning in response to the deteriorating trade tensions, and also benefited from China's reduced reliance on the U.S. market compared to when Trump initiated the first trade war in 2018.
"For China, this new round of trade war was not unexpected," said Larry Hu, chief China economist at Macquarie, an Australian investment bank. He noted that China's swift retaliatory actions, rather than seeking to ease tensions, indicated that China was prepared for a confrontation and would unlikely rush into negotiations with Washington.
He added, "Trump had expressed his intention to increase tariffs during his campaign, and China still set its economic growth target around 5% this year, indicating early preparation."
Now, only two days remain before Trump's reciprocal tariffs are scheduled to take effect on September 9. Hu said, "There are still many uncertainties, and both sides may need to act opportunistically."
He further pointed out that China's negotiation "door" remains open, while "on the other hand, China will focus on expanding domestic demand to offset the impact of the trade war on external demand."
On July 7, Trump continued to defend his tariff policy at a press conference in the White House. Video screenshot.
On April 4, China announced a 34% import tax on all American goods, delivering a heavy blow to Trump's so-called "reciprocal tariffs." Additionally, China simultaneously implemented multiple export bans or control measures targeting more American enterprises involved in defense, aerospace, drone manufacturing, intelligence, and logistics. Following a series of countermeasures, the US stock market index futures fell by over a thousand points.
Tu Xinquan, dean of the China WTO Research Institute of the University of International Business and Economics, told the Financial Times of Britain that China's reaction to the previous two rounds of tariff increases was "mild and patient," but later realized that patience was not enough.
He pointed out that China's new "package" of countermeasures was "very strong," and "unless Trump further increases tariffs or takes sanctions, China will add more countermeasures. We no longer have any hope for the United States."
Dr. Zhong Yu, a researcher at the Institute of Agricultural Economy and Development of the Chinese Academy of Agricultural Sciences, also emphasized, "China must do this; if we don't take countermeasures, we will be in a passive situation."
Dr. Zhong mentioned that American soybeans were again included in China's countermeasure list. Since the first trade war, Brazil has replaced the United States as China's largest supplier of soybeans. Under the new tariff policy background, Dr. Zhong believes there is still room for growth in imports from Brazil.
He also pointed out that China has been striving to increase domestic production, maintaining output above 20 million tons annually, and is committed to finding alternative feed protein sources such as corn to replace soybeans.
"Although we are making efforts (to improve self-sufficiency), in the short term, China still depends on the international market," Dr. Zhong added.
The report pointed out that over the past seven years since 2018, with Chinese exporters expanding their business to more markets, China's dependence on the U.S. has decreased. Official U.S. data shows that the total bilateral goods trade between the U.S. and China reached $582.4 billion in 2024, lower than $661.5 billion in 2018. During this period, the U.S.' share in China's exports dropped from 19.2% to 14.7%.
"The U.S. launched a surprise attack, followed by China's unexpected counterattack, which was well-researched and prepared," said Shaoyu, a council member of the Shanghai Finance and Development Laboratory.
When discussing the escalation of the trade war, he also stated, "The consequences will still be astonishing." He warned that the global supply chain would suffer "serious damage," and no country could completely avoid its impact, "No one is prepared for this."
"There is still room for maneuver, but time is running out," he further explained. If the U.S. stops importing goods from the global market, the dollar liquidity supporting the entire global financial and economic system may disappear.
Analysts also warned that China still needs to reach an agreement with the U.S., and more stimulus policies must be introduced this year.
Zheng Ziqiang, chief China economist at Morgan Stanley, said, "The cumulative tariffs imposed by the U.S. will far outweigh those from 2018 to 2019, slowing this year's economic growth by 1.5 to 2 percentage points. China may accelerate the implementation of planned stimulus measures and soon introduce new easing policies."
"The Chinese economy already has sufficient resilience to cope with the impact of tariffs, whereas the U.S. economy is already under great pressure," wrote David Fickling, a columnist for Bloomberg, in a commentary article on April 6. Although there is a saying that "the best retaliation is no retaliation" regarding the trade war, as tariff conflicts are essentially a lose-lose situation, the best solution is to stay out of such confrontations. This logic applies to most economies, but China might be an exception.
He analyzed that through decades of planning, China has built an economic system robust enough to withstand the impact of a trade war. Moreover, due to differences in the trade commodity structure between China and the U.S., China is affected far less than the U.S. — the U.S. mainly imports consumer goods like mobile phones and furniture from China, directly increasing costs for American consumers; whereas China imports more intermediate products like chips from the U.S., with limited impact on ordinary consumers. Additionally, China holds an advantage in diversifying export markets, while U.S. consumers find it difficult to find alternative suppliers. Trump's tariff policies may backfire, inadvertently aiding China's rise in global influence.
In Mr. Fickling's view, China's confidence in retaliating stems from being the world's largest manufacturer, having built an economic system resilient enough to withstand the impact of a trade war over several decades.
Despite the waves of doubt and counterattacks, Trump remained defiant. On April 7 local time, Trump claimed that he had "not considered" pausing tariffs for negotiations. He tried to emphasize that many countries are negotiating with the U.S.
On April 8, the spokesperson for China's Ministry of Commerce said that China noted that on April 7 Eastern Time, the U.S. threatened to impose an additional 50% tariff on China. China firmly opposed this. If the U.S. escalates its tariff measures, China will resolutely take countermeasures to safeguard its own interests.
The spokesperson said that the U.S. imposing so-called "reciprocal tariffs" on China lacked justification and was a typical example of unilateral bullying. The countermeasures taken by China were to protect its sovereignty, security, and development interests, maintain normal international trade order, and were entirely justified. The U.S. threat to escalate tariffs on China was a step in the wrong direction, once again exposing the essence of U.S. extortion. China would absolutely not accept this. If the U.S. insisted on its course, China would see it through to the end.
The spokesperson reiterated that there is no winner in a trade war, and protectionism offers no way out. Coercion and threats are not the correct ways to deal with China. China urged the U.S. to immediately correct its mistakes, cancel all unilateral tariff measures against China, stop its economic and trade suppression, and resolve differences with China through equal dialogue based on mutual respect.
This article is an exclusive piece by the Observer Network and cannot be reprinted without permission.
Original source: https://www.toutiao.com/article/7490815700895793715/
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