Daily Management Review

China Mocks The Latest US Tariffs - 'What Doesn't Kill You Makes You Stronger'


China Mocks The Latest US Tariffs - 'What Doesn't Kill You Makes You Stronger'
China's calm reaction to the United States' decision to increase duties on $18 billion worth of Chinese imports, ranging from batteries to needles, indicates that rather than a new trade war, ties between the two biggest economies in the world are likely to become more icy. China promised to take "resolute measures" to safeguard its interests and condemned the Biden administration's conduct.
Analysts noted that, in contrast to 2018, when Trump's tariffs on $300 billion worth of Chinese imports ignited an intensifying trade war, Beijing's reaction also points to a different dynamic—and confidence.
The Biden White House alerted Chinese officials ahead of time to possible actions, and the tariffs target sectors where the economic impact is minimal and the dominance of Chinese enterprises seems unchallenged, such as EVs and batteries. These are just a few of the distinctions between then and today.
Chinese state media has responded forcefully to the levies, charging that the US is violating free trade agreements and pursuing actions that will increase costs for US consumers and jeopardise climate goals.
The argument basically states that you are harming yourself.
This is a departure from the rhetoric of 2018, when a Chinese negotiator accused Washington of putting "a knife to China's neck" and when official media advocated drastic actions to avert the situation, such as selling off US assets or boycotting food imports from the country.
"China can take the moral high ground," stated Wang Huiyao, the founder and head of the think tank Centre for China and Globalisation, located in Beijing. "It doesn't play around with those who break international standards and norms."
The Chinese Commerce Ministry responded in the worst terms possible, claiming that the White House had violated the terms of a deal that U.S. President Joe Biden and Chinese President Xi Jinping had made in San Francisco late last year to stabilise bilateral ties.
U.S. officials have attempted to engage Beijing on limited areas of collaboration, such as climate change, and Biden has stated that he wants to win this era of competitiveness with China without starting a trade war.
Analysts said China still has time to retaliate with specific measures of its own before the tariffs take effect. However, a lot has transpired since the 2018 trade spat.
Chinese automakers produced slightly around 800,000 electric cars in that year. China had overtaken Japan as the world's largest auto exporter by 2023, and Chinese automakers were ramping up their growth ambitions from Southeast Asia to Europe. EV output had increased by a factor of eight.
After being severely hampered by US sanctions in 2019, Huawei has recovered and is now leading the market for processors produced in China, rivalling Apple in the smartphone market and Tesla in the EV space.
In a statement on US tariffs, Xinhua stated, "What does not kill you makes you stronger." "It seems the famous quote applies to China's technology companies."
Beijing was aware that fresh levies will be implemented. During their recent travels to China, U.S. Treasury Secretary Janet Yellen and other officials emphasised that American jobs and businesses were at risk due to China's industrial potential to produce more electric vehicles (EVs), solar panels, and batteries than the country can consume.
Chinese government and state media have refuted that claim, asserting that supply chain advantages and innovation, not subsidies, are the real reasons why the nation's electric vehicle manufacturers dominate.
The world's second-largest economy, China, received $427 billion in goods imports from the United States last year, while the United States sent $148 billion to China. This trade imbalance has been there for decades and has grown increasingly contentious in Washington.
Prior to the election in November, both of the 2024 presidential contenders have adopted a strong stance against China, a move that observers say Chinese officials are aware of.
Sean Stein, head of the American Chamber of Commerce in China, said, "Does China really want to go to the mat fighting over these tariffs?" He claimed that the action taken was "far low end" of what was anticipated.
He went on, "The U.S. rollout was restrained."
After the election, Beijing will also think about who it wants to collaborate with.
"The thing about this Biden initiative is that it is election driven," Wang stated. "It is different to what Trump did, as he had already been president for one year and so was pursuing a trade war, rather than election."