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China urges U.S. not to play with fire by starting trade war

By Liu Ying  (People's Daily Online)    17:17, April 08, 2018

China warns the U.S. of getting burnt in the end by playing with fire after stirring up a trade war with China, as China is ready for further escalation from the U.S. side and is prepared with detailed countermeasures.

The US government announced on Tuesday a proposed list of 1,300 products subject to a suggested tariff of 25 percent, worth $50 billion. China struck back with a tariff plan of equal scale, with a list of U.S. products including soybeans, automobiles and aircraft.

On April 6, China gave a stronger response to the U.S. proposal for additional tariffs on a list of 100-billion-U.S. dollar Chinese products.

U.S. soybean future dropped following the release of China’s countermeasures.

Although the U.S. is a main supplier of soybeans to China, the soybeans are not irreplaceable. Statistics indicate that Brazil is the largest source of soybeans to China, while U.S. soybeans exported to China account for 62 percent of its total.

The U.S. aircraft industry will also suffer a lot from the countermeasures, which may cause not only China’s cancellation of orders for several thousand Boeing airplanes, in addition it may bring about the transfer of the global aircraft manufacturing industry chain to Europe and Asia.

What the U.S. will lose is not only orders, employment and profits, but also this future potential in the aircraft industry.

Moreover, the countermeasures directly attacked the U.S. automobile industry. The price for U.S. automobiles exported to China will rise by 20 percent after the tariffs are slapped on.

The competitiveness of the U.S. automobile industry, therefore, will fall sharply, and China will increase orders for automobiles from European and Asian countries. More importantly, slapping tariffs on imports of U.S. automobiles will stimulate development of China’s automobile industry.

The proposed tariff list based on the Section 301 investigation mainly involves China’s high-tech industries including aerospace, information and communication technologies, robotics, pharmaceuticals and machinery.

The investigation was initiated in the name of protecting intellectual property rights, while the truth is that China did not adopt U.S. technologies in neither its aerospace nor information or communications industries.

The U.S. has ulterior motives in starting the trade war. Its purpose is to curb China’s implementation of the strategy of “Made in China 2025” and its development of high-tech industries.

Nevertheless, the trick will not succeed after all, as the development of China’s emerging sectors, also China’s competitive industries involved in the strategy, will not be contained by these tariffs.

China’s economic structure has been successfully transformed. Its service sector has surpassed its industry to be the locomotive of China’s economic growth.

The country, which has been deepening reform and opening up, is also easing access to the service sector in the regards of finance, education, health care as well as the telecom industries.

However, the financial sector, as the core industry and economic lifeline of the U.S., will be likely to lose the opportunity of entering the world’s largest market of China because of the trade war.

The stirring up of a trade war initiated from the U.S. side will not only harm American people’s livelihood, it will also result in failure for enterprises to share benefits brought about by China’s growth

Today, the U.S. is undoubtedly kicking down the ladder after its economy just recovered from the financial crisis in 2008, when China contributed more than half to global economic growth at the height of the financial crisis. Without China, it may be have been difficult for the U.S. to get out of that crisis at the time. 

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Hongyu, Bianji)

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