China learned from Trump’s first trade war, changed tactics when tariffs came again
Washington: The leaders of both Canada and Mexico got on the phone with President Donald Trump this past week to seek solutions after he slapped tariffs on their countries, but China’s president appears unlikely to make a similar call soon.
Beijing, which unlike America’s close partners and neighbours has been locked in a trade and tech war with the US for years, is taking a different approach to Trump in his second term, making it clear that any negotiations should be conducted on equal footing.
China’s leaders say they are open to talks, but they also made preparations for the higher US tariffs, which have risen 20 per cent since Trump took office seven weeks ago.
Intent on not being caught off guard as they were during Trump’s first term, the Chinese were ready with retaliatory measures — imposing their own taxes this past week on key US farm imports and more.
“As Washington escalates the tariff, Beijing doesn’t see other options but to retaliate,” said Sun Yun, director of the China programme at the Stimson Centre, a Washington-based think tank. “It doesn’t mean Beijing doesn’t want to negotiate, but it cannot be seen as begging for talks or mercy.”
As the world’s second-largest economy, China aspires to be a great power on both the regional and global stage, commanding respect from all countries, especially the United States, as proof that the Communist Party has made China prosperous and strong.
After the US this past week imposed another 10 per cent tariff, on top of the 10 per cent imposed on February 4, the Chinese foreign ministry uttered its sharpest retort yet: “If war is what the US wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end.”
The harsh rhetoric echoed similar comments in 2018, when Trump launched his first trade war with China and it scrambled to line up tit-for-tat actions. Beijing’s leaders have since developed a toolkit of tariffs, import curbs, export controls, sanctions, regulatory reviews and measures to limit companies from doing business in China.
All are designed to inflict pain on the US economy and businesses in response to the American measures.
That allowed the Chinese government to react swiftly to Trump’s recent across-the-board doubling of new tariffs on Chinese goods by rolling out a basket of retaliatory measures, including taxing many American farm goods at up to 15 per cent, suspending US lumber imports and blacklisting 15 US companies. Beijing showed restraint in its response to leave room for negotiation, analysts say.
