Warnings Against Tariff Increases
A senior official from China’s Commerce Ministry has strongly cautioned that any future tariff increases on Chinese exports by the United States will backfire. In a press conference in Beijing, Vice Commerce Minister Wang Shouwen addressed concerns about President-elect Donald Trump’s proposal for imposing a hefty 60% tariff on imports from China. Wang argued that such a move would not resolve the U.S. trade deficit and would only lead to higher import prices, ultimately fueling inflation.
Economic Dialogue Suggested
Wang also emphasized China’s willingness to engage in constructive discussions with the U.S. based on mutual respect that benefit both nations. He expressed the belief that a stable and sustainable economic relationship between China and the United States would yield positive outcomes for both sides. This notion underscores China’s desire for cooperation rather than confrontation in international trade.
Trade Performance Insights
China’s Vice Minister highlighted positive trade statistics that reflect resilience in its economy. From January to October, the total foreign trade (imports and exports combined) reached 36 trillion yuan (approximately $5 trillion), marking a 5% increase compared to the same timeframe in 2023. This growth demonstrates China’s ongoing capability to navigate global trade challenges, even amid increasing pressures from international tariffs.
Challenges Persist Amid Growth
Despite these optimistic trade figures, China’s ruling Communist Party faces significant challenges. The potential implementation of high tariffs could dramatically impact China’s economic growth, with estimates suggesting a 2.5 percentage point reduction in growth projections, according to UBS analysis. The government is grappling with various economic pressures, including a downturn in the property market, rising local government debts, and high unemployment rates among youth.
Measures to Bolster Trade and Tourism
In response to these economic challenges, Wang outlined some of the measures China is taking to revitalize trade and support sustainable development. Initiatives include simplifying customs procedures and enhancing visa policies to encourage foreign visits. Notably, the number of foreign visitors significantly increased this year, with more than half entering China through visa-free channels. This revitalization aims to strengthen China’s economy as it continues to face external pressures and evolving global trade dynamics.
SOURCE: Ref Image from The Express Tribune
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