China on Monday threatened to impose countermeasures on countries seeking to strike trade deals with the US at its expense in order to get American tariff exemptions.
In a pre-emptive move to stall a host of nations with whom China has lucrative trade ties from striking exclusive trade deals with the US to get tariff exemptions, the Commerce Ministry spokesperson warned that Beijing will firmly oppose such agreements.
The spokesperson made these remarks in a statement while responding to reports that the US is preparing to pressure other countries to restrict trade ties with China in exchange for tariff exemptions, state-run Xinhua news agency reported.
“If such a situation arises, China will not accept it and will resolutely take corresponding countermeasures,” the spokesperson said, adding that “trying to trade away others’ interests for temporary gains is like bargaining with a tiger for its skin – it will only backfire.”
The ministry warned that it will not tolerate any deals made by foreign governments at the expense of Chinese interests. It added that China has the right to resolve and the capability to safeguard its legitimate rights and interests.
“This is essentially using the banner of ‘reciprocity’ as a pretext to pursue hegemonic politics and unilateral bullying in the field of international economy and trade,” it said.
China’s tough stand came against the backdrop of reports that several countries, against whom US President Donald Trump imposed varied tariffs, are now seeking to work out bilateral trade deals with Washington to resume their exports to access the lucrative US market. Last week, the Wall Street Journal reported that the US plans to use tariff negotiations to pressure dozens of countries into imposing new barriers on trade with China.
Several countries and groups, including Japan, the EU and ASEAN, have lucrative trade with both China and the US. India too is negotiating a new trade deal with the US.
China is already battling Trump’s up to 245 per cent tariffs on its exports to the US, which last year amounted to $ 439.9 billion, by retaliating with 125 per cent levies against American exports.
Any bilateral trade deals by its major trade partners with the US could seriously impact China’s overseas trade, which amounted to $ 3.67 trillion, according to WTO data. This includes exports last year to its largest trade partners like ASEAN ($ 586.52 billion), EU ($ 580 billion) and Japan ($ 167.12 billion) as per official data.
China’s firm stand opposing any bilateral deals with the US also comes at a time when its export-dependent economy is on a slowdown mode weighed down by stagnating domestic consumption, the crisis in its housing sector and dwindling business confidence.
Beijing’s new threat to its trade partners was expected to leave these countries in a quandary as many of them are major exporters to China.
After Trump set off the tariff war with China while pausing tariffs against other countries, President Xi Jinping visited Vietnam, Malaysia and Cambodia last week, during which he called for “jointly opposing unilateral bullying”.
After Xi’s talks with top Vietnamese leaders last week, Trump sounded a warning, saying “That’s a lovely meeting. Meeting like trying to figure out, how do we screw the United States of
America?” Caught in the US and China trade war, ASEAN countries want to tread carefully. “We can’t choose, and we will never choose (between China and the US),” Malaysia’s trade minister Tengku Zafrul Aziz said after Xi’s visit.
