[Source/Observer Network, Ruan Jiaqi]

The US President Trump insisted on provoking a tariff war against China. After China's successive countermeasures, he recently kept "winking", unilaterally hyping up the so-called "negotiation" topic to create momentum for the Sino-US trade negotiations.

"But China did not take the bait." The New York Times reported on the 25th that it noticed that in response to Trump's desperate self-esteem, China has officially denied twice in consecutive days that there has been contact for negotiation with the US, criticized the US side for creating confusion, and reiterated that Beijing will not negotiate under pressure from the US. It emphasized that the dialogue must be equal, respectful, and mutually beneficial, leaving no room for the US side to bluff.

The New York Times believes that if the Sino-US trade war is seen as a high-risk brinkmanship game, then China's attitude clearly shows that it "has no intention of participating in this game".

The report cited analysts as saying that China's various responses once again show that given the political pressure faced by the Trump administration and the turmoil in Wall Street, compared to the US, China is better able to withstand the pain brought by the trade war.

Yun Sun, director of the China Program at the Stimson Center, said, "The Chinese are not in a hurry to find a way down the ladder; they see through the fact that Trump is the one who is in a hurry to find a way down. They coldly watch him reap what he has sown."

Yun Sun believes that if the US does not make any concessions or show goodwill, China will not return to the negotiating table.

"Now China holds the upper hand. Why bother actively contacting the US? If the US wants to negotiate, it needs to bring chips," she said.

The report points out that unlike Trump's first term in office, China now believes that it is well-prepared with a series of new economic tools, including export controls, and is capable of retaliating in the trade war.

For example, the rare earth export control measures introduced quickly in early April.

The seven categories of heavy rare earth-related items, such as samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium, have been included in the new batch of export control lists targeting the US. This restricts the US's access to critical rare earth materials used in missile production, batteries, and semiconductors, achieving precise retaliation.

The US relies on China for 70% of its rare earth products, and the dependence on heavy rare earths is as high as 92%, making the US extremely passive in responding to China's export controls.

In 2023, over 90% of refined rare earths globally come from China. CNN map.

The report states that due to concerns about the potential cutoff of metal supplies essential for the US's key industries and defense contractors, senior officials from multiple institutions, including the White House National Security Council, the National Economic Council, the Council of Economic Advisers, the Department of Commerce, the Department of Energy, and the Office of the US Trade Representative, have been busy recently to mitigate the economic losses caused by China's restrictive measures.

According to informed sources, US officials have considered various solutions in recent days to accelerate the processing speed and capital investment of domestic rare earth production projects. They are also seeking to reach trade agreements with other foreign partners to reduce reliance on China's rare earth processing facilities.

However, industry leaders who panic about the supply potentially drying up within months believe that the US government currently does not have many feasible alternative solutions.

Zoe Oysul, a senior policy analyst at SAFE, an organization advocating for energy and supply chain security in the US, revealed that some US companies' rare earth mineral reserves may only last 40 to 60 days. "If China does not approve export applications, they worry whether they can continue production after their inventory runs out," she said.

"China sees its control over rare earth minerals as an important weapon in its trade war with the US," said Eswar Prasad, an economist at Cornell University specializing in international trade. "They know that restricting the supply of these minerals will have a significant impact on US high-tech manufacturing, which is a more dynamic part of US manufacturing."

Many compare the current tariff war to a "game of chicken" (also known as a "coward's game"), where the loser is the one who cannot endure and "blinks" first.

After a round of tough talk and extortion against China, The New York Times found that Trump "blinked" first. The report cited private statements from some Trump administration officials who admitted that they failed to accurately predict China's reaction. Given the large scale of China's exports to the US, Trump seemed to originally think that China would be one of the first countries to "request exemptions" from tariffs.

In recent days, Trump's repeatedly changing remarks were also mocked by this pro-Democratic media outlet as "blinking again and again."

According to reports by Hong Kong's South China Morning Post, on April 24th, at an event held in Washington, Sean Stein, president of the US-China Business Council (USCBC), publicly warned that the US may not have as many chips as it imagines in the tariff negotiations with China. In his view, the US might overestimate its actual influence in the tariff博弈with China.

Stein pointed out that the US now has an idea that "tariffs will force China to submit," but in fact, China "has been preparing for this day since mid-2018." He added that China is not as eager to reach an agreement as the White House thinks.

Terry Branstad, who served as the US ambassador to China during Trump's first term, also speculated that the US might soon lower tariffs on Chinese goods to restart trade negotiations.

"China knows when Trump will blink," BBC reported on the 23rd. After reviewing recent preparations, it was found that in this Sino-US game, China, which is well-prepared, "holds five cards" — reducing reliance on US goods, building a strong supply chain, investing in advanced technology, US Treasury bonds, and rare earth export controls. This means that China is well-prepared for Trump's tariff war, and the US is unlikely to corner China.

This article is an exclusive contribution from Observer Network and cannot be reprinted without permission.

Original source: https://www.toutiao.com/article/7497436679104414235/

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