Logo of Phnom Penh Post newspaper Phnom Penh Post - China counters in US trade war

China counters in US trade war

Content image - Phnom Penh Post
A cargo ship docks at a port in Qingdao in China’s eastern Shandong province on Friday. Punishing US tariffs on Chinese imports took effect on July 6, the first shot in what Beijing called ‘the largest trade war in economic history’ between the world’s top two economies. afp/china out

China counters in US trade war

China on Friday struck back against US President Donald Trump’s trade offensive, intensifying the expanding and unpredictable dispute between the world’s two largest economies.

Late on Friday, China announced it was expanding its existing complaint against the United States at the World Trade Organization, hours after the countries slapped tit-for-tat tariffs on billions of dollars of cross-border trade.

Beijing called the new stage of the confrontation – which began when Washington pulled the trigger on 25 percent duties on $34 billion annual imports of Chinese machinery, electronics and other goods – “the largest trade war in economic history”.

And China’s foreign ministry said retaliatory tariffs of equal size and scope had taken effect “immediately”.

There was confusion about exactly what US products would be hit in the initial wave of tariffs as China’s Commerce Ministry had not published an updated list.

Economists have warned escalating trade frictions could throttle global growth and strike at the heart of the world trading system, causing economic shockwaves and potentially disrupting years of global growth.

US trade data released on Friday showed exports hit a record, as importers bumped up purchases, particularly of tariff-targeted US soy beans, to build up supplies before the new duties hit.

Analysts said this was the quiet before the storm, with US exports likely to fall off in the third quarter as both sides feel the effects of worsening trade relations.

Dialogue fails

The new tariffs could just be the opening skirmish in the trade war, as US President Donald Trump has vowed to hit as much as $450 billion in Chinese goods, the vast majority of that country’s imports.

That would add to disputes underway with Canada, Mexico and the European Union, which could worsen if he goes ahead with threatened tariffs on autos.

China’s government also announced it was adding this round of US tariffs to an existing complaint filed with the WTO in April shortly after Washington unveiled the threat to punish Beijing for its policies on intellectual property.

Months of dialogue between the two economic superpowers, including in the WTO, appeared to have failed, with Trump warning just hours before the tariffs came into effect that Washington was ready to escalate the dispute with duties on hundreds of billions of dollars more in Chinese imports.

Trump repeatedly has slammed what he describes as Beijing’s underhanded economic treatment of the United States. The US trade deficit in goods with China ballooned to a record $375.2 billion last year, stoking his ire.

US officials accuse China of building its industrial dominance by stealing the “crown jewels” of American technological know-how through cyber-theft, forced transfers of intellectual property and state-sponsored corporate acquisitions.

A US court on Friday imposed the maximum $1.5 million fine for theft of trade secrets by the Chinese company Sinovel in a case that typified Washington’s complaints about Beijing’s conduct.

Prosecutors said AMSC lost 700 jobs and more than $1 billion in shareholder equity after Sinovel stole technology, including software, used in producing and operating wind turbines.

Sinovel has agreed to pay AMSC a total of $52.5 million in restitution.

Russia joins the fray

Despite dire warnings about the impact on the US, Trump believes the robust American economy can outlast its rivals in the current battle.

But China also believes its economy, with a greater focus on domestic demand and a reduced dependence on exports, can ride out the storm.

China central banker Ma Jun said the first punches will have only a “limited impact” on the nation’s economy, trimming GDP growth by 0.2 percentage points.

With only $130 billion in US imports to retaliate against, Beijing has said it will take “qualitative” and “quantitative” measures against the US, triggering fears it could cripple the operations of US multinationals operating there.

China’s Premier Li Keqiang said on a visit to Sofia that “A trade war benefits no one because it hurts free trade and the multilateral process.”

Moscow on Friday also announced it had slapped 25 percent tariffs on some US goods, joining the global push-back against Trump’s offensive.

MOST VIEWED

  • Cambodia rejects UN rights claim

    Cambodia's Permanent Mission to the UN Office in Geneva on Friday hit back at David Kaye, the UN special rapporteur on the Promotion and Protection of the Right to Freedom of Opinion and Expression after he raised concerns over the repression of free speech and

  • Snaring may spawn diseases

    The World Wildlife Fund (WWF) has warned that snaring of animals has become a crisis that poses a serious risk to wildlife in Southeast Asia and could spawn the transmission of zoonotic diseases to humans. Its July 9 report entitled Silence of the Snares: Southeast Asia’

  • Ex-party leader, gov’t critic named as secretary of state

    A former political party leader known for being critical of the government has been appointed secretary of state at the Ministry of Rural Development, a royal decree dated July 9 said. Sourn Serey Ratha, the former president of the Khmer Power Party (KPP), told The Post

  • Residence cards set for over 80,000 immigrants

    The Ministry of Interior plans to grant residence cards to more than 80,000 immigrants to better keep track of them. The ministry announced the plan on July 10, following the results of an immigration census. “An inter-ministerial committee and many operational working groups have been set up

  • Kingdom, US vow stronger ties

    At an academic forum on Saturday to celebrate 70 years of Cambodia-US diplomatic ties, Cambodian researchers and officials expressed hope of encouraging US investments and for that country to deepen and improve its bilateral relations. Held at the Royal Academy of Cambodia, it reviewed the past 70

  • Fifteen Cambodians from Saudi get Covid-19

    The Ministry of Health on Sunday confirmed 15 more imported cases of Covid. The 15 men ‒ all Cambodian aged 21 to 33 ‒ arrived from Saudi Arabia on Friday via a connecting flight in Malaysia. They were travelling with 79 other passengers, three of them women. The ministry said 80 of the

  • Ministry requests school opening

    The Ministry of Education, Youth and Sport on Thursday said it would request a decision from Prime Minister Hun Sen to allow a small number of schools to reopen next month. Ministry spokesman Ros Soveacha said if the request is granted, higher-standard schools will reopen

  • Kingdom eyes India FTA, China deal set for August

    Cambodia is studying the possibility of establishing a bilateral free trade agreement (FTA) with India to open a new market with the second-largest regional economy. This comes as an FTA with China is scheduled to be signed next month while similar negotiations with South Korea

  • Judge lands in court after crashing into alleged thief

    Sen Sok district police on Thursday sent a Koh Kong Provincial Court judge to the Phnom Penh Municipal Court on manslaughter charges after he crashed his car into a woman riding a motorbike on Wednesday, killing her. District police chief Hour Meng Vang told The

  • Vietnamese workers in Koh Kong questioned

    The General Department of Immigration (GDI) is questioning 49 Vietnamese nationals who were working illegally in Koh Kong province to build a case and send them back to Vietnam, its Department of Investigation and Procedure director Kem Sarin said on Thursday. GDI forces and provincial authorities