Mint Quick Edit | Dial back the US-China trade war: It’s lose-lose

Talks between Trump and China’s leader Xi Jinping are due later. (AP)
Talks between Trump and China’s leader Xi Jinping are due later. (AP)

Summary

  • China has announced retaliatory tariffs after the US upped barriers for Chinese imports. Its strategy seems nuanced, but both sides must back down.

Within days of the US declaring a 10% extra tariff on imports from China, Beijing has retaliated with announcements of its own that will make US shipments to the People’s Republic costlier. American coal and LPG will now face 15% tariffs and a 10% levy will apply on US crude oil, farm equipment and certain vehicles. In addition, Beijing is targeting US businesses, such as Google, which faces an antitrust probe. Google has long been blocked in China, but still has ad operations there. Beijing also imposed some export controls. 

The message is clear: It won’t buckle under pressure. 

Also Read: Madan Sabnavis: The targets of Trump’s tariff strikes need not ‘chicken out’

Earlier, Canada and Mexico struck deals with President Donald Trump, who held off tariffs by a month in return for assurances on his border-security and drug-flow demands. 

We’re now in a world of trade policy being warped out of its economic rationale and deployed as a weapon of geopolitics. Trade wars are lose-lose. They leave everyone worse off, whether or not the original aggressor gets its way. 

Also Read: Trade war alert: Brace for a rough ride as Trump’s tariffs kick in

Beijing’s response suggests a strategy that’s subtle and confident of Chinese might. Is it adaptable? Talks between Trump and China’s leader Xi Jinping are due later. This trade war needs de-escalation on all fronts.

Also Read: Trump tariffs could hit the eurozone hard: The ECB should ease credit

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