THE on-going trade war between the United States and China will not stop the development of the Asian nation, although tensions have affected not just bilateral trade between the two countries, but also world trade, the Deputy Head and Political Counsellor of the Chinese Embassy in Zimbabwe Zhao Baogang says.
By Lisa Tazviinga
Zhao’s comments come in the wake of Beijing releasing a hard-hitting White Paper accusing US of adopting bullying tactics while warning that it was not afraid of a trade war and would not compromise on matters of principle.
“The development of China is like galloping Zambezi river,” Zhao told the Zimbabwe Independent in an interview.
“Though facing ups and downs and twists and turns, it will flow through and reach its destination — the Ocean. China will achieve its objectives of development and national rejuvenation finally. No challenge will hold back China’s development.”
China and US have for several months held talks aimed at reaching a trade deal, but the latest round of trade talks failed, with Beijing accusing the Donald Trump administration of frequently backtracking on its commitments and making new demands, including mandatory requirements concerning China’s sovereign affairs in the trade deal.
The US has raised its duties from 10% to 25% on US$200 billion of Chinese exports into the US, and in retaliation China increased tariffs on US$110 billion of US goods.
“The US escalated the stakes in May by putting the Chinese telecom giant Huawei on a blacklist that bars US companies from supplying it with computer chips, software and other components without government approval. China then announced last Friday that it would set up the unreliable entities list, a mechanism targeting foreign enterprises, organisations and individuals that don’t obey market rules, violate contracts and block, cut off supply for non-commercial reasons or severely damage the legitimate interests of Chinese companies,” Zhao said.
The escalating tension between the two economic powerhouses will see global trade slowing by 2,6% in 2019, according to the World Trade Organisation.
China this week released a white paper stating it prefers dialogue with the US but would not compromise its position.
China said threats of a trade war and continuous tariff hikes would not resolve trade and economic issues adding only consultations which are “guided by a spirit of mutual respect, equality and mutual benefit” would do so.
“Every country has its own matters of principle. During consultations, a country’s sovereignty and dignity must be respected, and any agreement reached by the two sides must be based on equality and mutual benefit. On major issues of principle, China will not back down,” Beijing said.
“. . . The recent US move to increase tariffs on Chinese exports does not help to solve bilateral trade issues.
China strongly opposes this and has to respond to safeguard its lawful rights and interests. China has been consistent and clear on its position, that it hopes to resolve issues through dialogue rather than tariff measures.
“China will act rationally in the interests of the Chinese people, the American people, and all other peoples around the world. However, China will not bow under pressure and will rise to any challenge coming its way. China is open to negotiation, but will also fight to the end if needed.”
Beijing said its development would not be halted by the trade war despite difficulties.
“China’s development may not be all smooth sailing. Difficulties or even perils are inevitable. Whatever the future might bring, China is confident of meeting challenges head on, turning risks into opportunities, and opening new chapters,” the White paper reads.
“China remains committed to its own cause no matter how the external environment changes. The fundamental solution to economic and trade tensions is to grow stronger through reform and opening up.”
Beijing said the trade was affecting both China and US, while also affecting global trade. “The uncertainty brought by US-China economic and trade friction made companies in both countries more hesitant about investing. China’s investment in the US continues to fall and the growth rate of US investment in China has also slowed down.
According to Chinese statistics, direct investment by Chinese companies in the US was US$5,79 billion in 2018, down by 10% year-on-year. In 2018, paid-in US investment in China was US$2,69 billion, up by only 1,5% year-on-year compared with an increase of 11% in 2017.”