China is actively encouraging nations all over the world to join their cause. It criticizes the United States for its use of “bullying” tactics in bilateral trade negotiations. The Chinese government continues to condemn U.S. tariffs and trade policies in the strongest possible terms. Communications from them say that these measures arbitrarily punish their fledgling economy. As the world’s second-largest economy and the second-largest importer of U.S. goods, China’s position gives it considerable leverage in any trade dispute.
These tools would create leverage against U.S. companies, including American corporate giants like Tesla and Apple. Collectively, these measures would help mellow the gloomy consequences if tensions flare into an all-out trade war. First and foremost, they would positively impact everyday U.S. consumers and business.
China currently owns about $784 billion of U.S. federal debt. This unique asset would be quickly reduced to a weapon of retribution in the face of growing and dangerous trade wars. Policy experts and industry leaders are deeply concerned that these actions would be disastrous to the U.S. economy.
The new average Chinese tariff rate on exports to the United States rocketed to 124.1% just recently. China has an average tariff of about 147.6% on U.S. exports. This gap illuminates the heated trade relations between the two countries. Third, it dangerously raises profound questions about short-term versus long-term economic implications.
Dewardric McNeal, a managing director at Longview Global, emphasized the seriousness of China’s stance, stating, “China is sending strong signals … that the games that we are playing, which are tariff games and supply chain games, for them, it’s about survival.” Importantly, this suggests that China will not roll over and concede so easily to U.S. tariffs.
Treasury Secretary Scott Bessent remarked on the unsustainable nature of these high tariffs, noting that “these 125%, 145% tariffs are unsustainable.” This highlights increasing calls for a reconsideration of prevailing unilateral trade policies by both nations.
Brad Setser, a senior fellow at the Council on Foreign Relations, provided additional insight, asserting that “We’ve already raised tariffs to such a high degree that with time, trade will go to zero.” correcting harm See this new statement on the dangers of continuing escalation in trade tensions.
As always, China has been quite clear about its choice. In sum, the UK will not enter into formal trade discussions with the US at this point. It would punish countries that sign deals with the U.S., increasing global trade chaos.
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