Donald Trump said on August 25 that he would announce an upgrade to the US-China trade war as a national emergency if he wanted to. US Treasury Secretary Steven Mnuchin said that if Trump declares a state of emergency, he can order the company to withdraw from China.
Mnuchin said that although Trump’s personal friendship with Xi Jinping is still very stable, the United States and China are already enemies in the trade and financial fields.
Earlier on August 23, the Chinese side announced anti-measures. Chinese state media reported that the State Council Tariff Commission decided to impose 10% and 5% on 5,078 tax items originating from the United States and about 75 billion US dollars. The tax will be implemented in two batches starting at 12:01 on September 1, 2019 and at 12:01 on December 15. Cars and parts that have been taxed and then removed have also been returned to the tariff list.
On August 23, Trump immediately posted more than a dozen tweets about China on Twitter and announced that the US will raise the existing tariff on Chinese goods of $250 billion from 25% to 30% on October 1. He It also said that the tariff on another US$300 billion Chinese commodity, which is scheduled to take effect on September 1, will rise from 10% to 15%.
Customs warfare has been escalated as usual, and China has no progress in lifting the ban. Beijing has suspended the purchase of US agricultural products. China-US trade negotiations can be said to have fallen into a new stalemate.
How does Beijing view the current stalemate?
After the Osaka Special Economic Conference, the China-US trade negotiators have made three calls and negotiated once. On July 9th, July 18th, and August 3rd, Robert Lighthizer and Mnuchin called Chinese Vice Premier Liu He. From July 30th to 31st, Wright Heze and Mnuchin went to China. Shanghai negotiations. Almost every time, the United States actively calls.
When the Shanghai negotiations, the location was in Xijiao Hotel, Changning District, Shanghai. The background text of the negotiation site is from a Chinese ancient poetry. The main content is: Yunlai Mountain is better, the cloud goes to the mountains as the painting; the mountain is clouded and the clouds are high. This seems to imply that it would be best if the China-US negotiations can be negotiated. If it is not possible, it will not hurt.
As early as May, Liu He visited the United States, Chinese officials have repeatedly said that they are fully qualified, capable and confident to deal with various risk challenges. Guo Shuqing, secretary of the Party Committee of the People’s Bank of China and chairman of the China Insurance Regulatory Commission, said in a 7,000-word written speech on May 25, “The trade war can’t solve any problems, harming others and harming the world. From China’s perspective, the United States Although tariffs can be added to the limit, the impact on the Chinese economy will be very limited.”
Paul Krugman, a US economist and Nobel laureate in economics, wrote in the New York Times on August 8 that China’s response so far has been fairly modest and measured. He said that compared to the US tariff bar, China has not used the many counter-measures they can use to offset Trump’s actions and hurt his political foundation.
Beijing’s current attitude toward signing the agreement seems to have become unactive, not active, ignores, and does not compromise. If you want to talk, you have to fight.
In this regard, Trump repeatedly complained that the negotiation process was too slow, and said that Beijing was using drag and drop, waiting for Trump to negotiate with the Democratic president after he stepped down. This is naturally Trump’s family name, but what does Beijing’s current position mean?
From the intent of Beijing, the most important task of Beijing in the first phase of the trade war is to unify the domestic front. Too fierce response, too comprehensive war, will only allow China and the United States to enter the final battle ahead of time, and now obviously is not the best time.
At the beginning of the trade war, the “China collapse theory” and “China’s surrender theory” were once very marketable. At this time last year, there were no doubts in China and abroad. The reason why the United States retaliated against China was because China’s diplomacy was too strong. Even during the Beidaihe meeting last year, many CCP veterans also commented.
Through more than a year of trade wars, China has re-recognized the United States, re-recognized the world, and more importantly, re-recognized itself. After two years of actual combat, China can cope with it, and at the same time, through the game of the situation in Hong Kong and Taiwan, it has reconfirmed the hostility of the United States to China. Obviously, since the Beidaihe Conference was held at the end of July this year, China’s foreign strategy in many fronts has become more tough, highlighting the consensus of the CCP’s top management. Some liberals who blame the Chinese government but have fantasies about the United States have to re-examine their claims.
Beijing is not chaotic enough to withstand trade wars. Beijing is not eager to attack the United States, and is not eager to fight the United States because the problem is not outside. In addition, the Beidaihe Conference and many other occasions are the testing grounds and touchstones of the Beijing authorities to verify whether internal problems are fully resolved and internal solidarity is sufficient. It is not so easy to look forward to unity. This may be something that has to be done for quite some time.
From the perspective of the war situation, the trade war has little impact on the China-US economy, and the focus is on public opinion. At the beginning, Beijing was eager to control the situation. It was because the trade war had formed an extraordinary sound effect in the international community and in China. Today, the hearts and minds of the people are gradually stabilizing. The impact of the trade war on the economy is not as big as it is supposed to be. People have also accepted the normalization of China-US relations. Therefore, China’s response is not fierce because Beijing does not need to constantly upgrade its trade war with the United States, and it is not necessary to treat these as situations that have to be dealt with.
Before May 2019, China had all the requirements for the United States, and at the same time, Trump’s approach was explored. Trump, who is levying tariffs, regards tariffs as a nirvana. Beijing wants Trump to understand that it is not useful to increase tariffs. Now is the endurance competition period in the strategic stalemate stage. The two sides are fighting the war of attrition and must stabilize their positions.
From the perspective of Beijing’s play, the real decisive battle between China and the United States will not be a tariff war. Beijing is waiting, waiting for Trump to do anything but to impose tariffs. Beijing is fully capable of coping with tariff wars. It is not a bad thing for China and the United States to repeatedly scan the issue of Huawei and agricultural products and tariffs. If Trump dares to fight the financial war currency war, it is the key, this is a new and dangerous field. Beijing must prepare for the next contest in advance. Constantly promulgating many financial opening measures, and fully promoting self-reform is the best preparation.