China's carefully measured response to Trump's trade war - Arthur Kroeber

Arthur Kroeber

Unlike the bully-like approach of Donald Trump, China has sent a carefully calibrated messages, trying to avoid a devastating trade war, says renowned economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know® to the South China Morning Post and the Washington Post. China has more cards up its sleeves, he suggests.

The Washington Post:

Hours after Trump’s announcement, China’s Commerce Ministry gave the first indication of potential targets for retaliation, which it linked to Trump’s earlier move to impose tariffs on steel and aluminum imports. 

It said it has compiled a list of 120 products worth nearly $1 billion, including fresh fruit and wine, upon which it would impose a 15 percent tariff if the two countries fail to resolve their trade differences “within a stipulated time.” It added that a 25 percent tariff on other goods, including pork and aluminum, could be imposed “after further evaluating the impact of U.S. measures on China.” 

Arthur Kroeber, managing director of Gavekal Dragonomics, said Beijing was sending a “carefully calibrated” message that it will stand up to Trump, while trying not to escalate the spat into a confrontation that could seriously threaten the global trading system. “The larger part of China’s strategy, though, is to position itself as the good guy in the global economy, protecting the rules of the game from Trump’s lawless attacks,” he said.

The South China Morning Post:

Arthur Kroeber, research head and co-founder of Gavekal Dragonomics, said China surely has “an equally specific, but longer”, list of targets ready to go when Washington finally unveils its Section 301 tariff list. 

“The strength of this response was carefully calibrated to send a clear message that Beijing will stand up to the US, but will not try to escalate the spat into a confrontation that could seriously threaten the global trading system,” Kroeber said.

More in the South Morning Post and the Washington Post. Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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