[Text/Observer Network Wang Yi] Where will the trade tensions between China and the United States go? On the 17th, Bloomberg cited sources as saying that the Trump administration seemed to be preparing to pressure other countries to limit their trade with China; but on the same day, Trump himself said he was unwilling to continue increasing tariffs on China, and even hinted at possibly reducing these tariffs.
An anonymous source told Bloomberg that Trump's senior economic advisors were considering requiring trade representatives coming for negotiations to impose so-called secondary tariffs on countries closely related to China. Another source said that Mexican officials expected the US to ask them to increase tariffs on Chinese electric vehicles.
Bloomberg reported that dozens of countries are negotiating tariff reductions with the US, in exchange, the US hopes these countries will stop buying Chinese goods and take measures to restrict China's manufacturing strength to prevent China from finding ways to circumvent the tariffs.
The report pointed out that this move is equivalent to the Trump team trying to use trade partners to surround China and pressure Beijing to force China to change its economic policies. It remains unclear whether this strategy will succeed, but some foreign officials expressed skepticism about reaching a tariff agreement after preliminary negotiations with the US.
On the local time of the 16th, the US and Japan began negotiations on tariff issues. The Japan Times believed that despite both sides expressing goodwill, they made little substantive progress. Japanese Prime Minister Shinzo Abe stated on the 17th in Tokyo after hearing the report of the talks that future negotiations "would not be easy" and "there are still differences in positions between Japan and the US."
A photo of Trump and Japanese Minister of State for Economic Revitalization Akira Shimada on social media.
However, Treasury Secretary Scott Beason, who participated in the US-Japan tariff negotiations, seemed very optimistic. He hoped that the US would engage with trade partners like Japan and pressure them to limit trade with China.
Beason expressed optimism last week regarding some traditional American allies, stating, "They are good military allies but not perfect economic allies," and if a tariff agreement could be reached, "we can collectively engage with China."
However, it seems that the Trump team is divided on the ultimate goal of the trade war they initiated against China. On the 17th, Trump mentioned tariffs on China in the Oval Office of the White House, saying, "At a certain point, I don't want them to rise because at a certain point, people won't buy," "So I may not want to add more, or maybe not to that level," "I might want to reduce them because you want people to buy."
Foreign Ministry Spokesperson Lin Jian stated on April 10 that China absolutely refuses to accept the bullying behavior of the US imposing arbitrary tariffs on China. Coercion, threats, and blackmail are not the correct way to deal with China. "If the US really wants to negotiate, it should show an attitude of equality, respect, and mutual benefit. If the US disregards the interests of both countries and the international community and insists on a tariff war and trade war, China will certainly see it through to the end."
Bloomberg analysis pointed out that for Trump's plan to "surround China" to succeed, support from Europe and Asian countries is needed, but these countries have been reluctant to significantly reduce their trade with China. Trump's decision to impose tariffs on friends and foes alike has also led some foreign governments to no longer view the US as a reliable ally.
Paul Krugman, professor at City University of New York and 2008 Nobel laureate in economics, wrote an article on the 16th stating that the US attempting to reach an agreement with other countries to isolate China is unlikely to succeed because Trump has completely lost credibility. Unless other countries' governments believe the US will abide by the agreement, such agreements cannot be reached, and Trump has torn up all existing trade agreements and made wild modifications to his tariffs every few days, destroying America's credibility in this regard.
In fact, it has been proven that following the instructions of the Trump administration does not only fail to earn exemption from US tariffs, but may also harm oneself.
Bloomberg used Canada as an example, stating that striking at China does not necessarily bring guarantees from the US. To please the US, Canada announced high tariffs on Chinese electric vehicles, steel, and aluminum, and declared measures to strengthen border security with the US, but in the end, Trump still imposed tariffs on Canada.
On the 17th, the Hankyoreh Daily bluntly stated that the US using high tariffs as a bargaining chip to try to restrict Chinese enterprises' investment in third countries is rare internationally and may infringe on the economic sovereignty of other countries. Especially for South Korea, this strategy may bring a more severe dilemma. Last year, China surpassed the US to become South Korea's largest export market, making it an extremely important trading partner. If these economic ties need to be restricted, South Korean companies will be affected first. Now, South Korean government and enterprises are caught between the US and China's semiconductor export control measures, struggling to advance or retreat.
Krugman believes that the EU has no reason to participate in the US-China trade war because it will destroy its own supply chains. For the EU, joining forces with the US against China would be a thankless task: besides damaging its own supply chains, it might find the US turning its guns on itself and imposing punitive tariffs again.
Sources also told Bloomberg that the EU did not make significant progress in resolving trade disputes during this week's negotiations with the US because Trump's advisors gave the impression that most tariffs on the EU would not be canceled.
When Trump's tariffs caused global economic chaos last week, Beason warned the EU not to turn to China, singling out Spain, calling it "akin to cutting one's own throat." Carlos Cubero, Spanish Minister of Economy, Trade, and Enterprise, rebutted Beason's warning, stating that maintaining relations with all major powers worldwide is crucial for Europe. After meeting with Beason on the 15th, he told reporters that China must become a "strategic partner" for the EU.
The Christian Science Monitor of the United States said that the top priority for US allies is to protect their own economies from the impact of Trump's tariff policies. In recent years, they thought they would maintain close economic and trade ties with the US, but times have changed. Now, when the phone rings, it is likely to be from China.
This article is an exclusive piece from the Observer Network and cannot be reprinted without permission.
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