Chinese officials are now pondering if Donald Trump’s expected announcement about “reciprocal” tariffs on their trading partners will escalate into a trade war. Officials have been left guessing by Trump’s mixed messages. Trump continues to rally against the vast trade deficits between the U.S. and China. Leaders in Beijing are waiting to see if Trump’s April 2 “Liberation Day” will escalate the mounting situation even further.
What Trump Has Threatened So Far
Trump has repeatedly threatened upwards of 60% duties on all goods coming to the U.S. from China. However, over the past few days, Trump has hinted that he may consider reducing the tariffs, which hinge on the popular Chinese social media site TikTok’s sale. On Sunday, Trump spoke with journalists aboard Air Force One as he returned to Washington, D.C. He once again vowed that before Saturday’s deadline, there would be a completed deal on the social media platform.
During the flight, Trump also claimed that he had a “great relationship with Chinese leader Xi Jinping, even though the U.S. government was enforcing tight reins on China’s access to US technology and pushing for even more restrictive control. The Chinese do not stand alone in facing vacillations from Trump in his second term as president. Trump has used uncertainty as a weapon against trade partners across the board.
The threat of Tariffs Has Already Caused Damage
Asian shares fell due to the risks that the upcoming tariffs could bring. Japan’s and South Korea’s stock markets were both hit extremely hard. Carmakers in those regions are also expected to be hit extremely hard by Trump’s proposed tariffs.
Wang Yi, China’s foreign minister, said that China will seek retaliation over the United States’ “arbitrary tariffs.” During a press conference after the country’s annual parliamentary session on Friday, he accused Washington of “meeting good with evil in those regions.” Wang also added that China’s continuing efforts to help contain the fentanyl crisis in the U.S. have been met head-on with punitive tariffs and are adding more tension to their straining ties.
China Views Threat to Bilateral Relations
“No country should fantasize that it can suppress China and maintain a good relationship with China at the same time,” Wang added. “Such two-faced acts are not good for stability or bilateral relations or for building mutual trust.” Wang also stated that Trump’s practice of safeguarding U.S. interests over international cooperation would create the “law of the jungle.”
Wang also said that Trump’s practice of safeguarding U.S. interests over international cooperation would create the “law of the jungle.” He added that “small and weak countries will get burnt first, and the international orders and rules will be under severe shock. Major countries should undertake their international obligations…and not seek to profit from and bully the weak.”
What Economists Say
Trump has repeatedly argued that his proposed tariffs could raise over $1 trillion in the next year for the government. He also claims that it will reduce national debt and offset certain income taxes. Economists, however, disagree and argue that the tariffs will bring nothing close to the billions Trump has predicted. The experts predict that consumers will quickly reduce what they spend on foreign goods as soon as the prices rise.Â
