China Warns Against Siding with the US on Trade Deals

Ever since President Trump put in place triple digit tariffs on trade with China it has been clear that Trump was looking to isolate China by seeking more favorable trade deals with other countries. Yesterday, China warned countries not to appease the United States or take sides against them, saying there would be repercussions for any nations that did so.

The Chinese government on Monday warned other countries against curbing trade with China in order to win a reprieve from American tariffs, promising to retaliate against countries that do so.

The Chinese Ministry of Commerce said it was responding to foreign media reports that President Trump’s administration was trying to pressure other countries on their trade with China as a negotiating tactic.

“Appeasement will not bring peace, and compromise will not earn respect,” the ministry said in a statement. “Seeking so-called exemptions by harming the interests of others for one’s own selfish and shortsighted gains is like negotiating with a tiger for its skin. In the end, it will only lead to a lose-lose situation.”

China “firmly opposes any party reaching a deal at the expense of China’s interests,” it said, adding that China would “resolutely take countermeasures.”

While China is making threats, other countries are negotiating with the US.

Japan kicked off negotiations with the US last week when its top tariff negotiator, Ryosei Akazawa, met the US President in Washington DC.

South Korea’s acting president, Han Duck-soo, has said his country will begin trade talks with the US later this week.

Meanwhile, US Vice President, JD Vance, is expected to meet India’s Prime Minister Narendra Modi during a visit to the country this week. India faces a tariff rate of 26% if it is unable to agree a trade deal with the Trump administration.

Last week, Vance said there was a “good chance” a trade deal could be reached with the UK.

And China has been doing the same thing, with Xi Jinping traveling to a number of countries to discuss trade deals that could potentially benefit them. But so far willingness to side with China over the US seems limited.

In his first foreign trip this year, Xi visited Vietnam, Malaysia and Cambodia last week, signing a barrage of bilateral cooperation agreements and pledging to uphold free and open trade. The three export-reliant economies were hit by US “reciprocal” tariffs of up to 49% before the levies were paused…

But while countries appear receptive to Beijing’s outreach, they are also wary of being flooded with cheap Chinese goods that are now shut out of the US markets due to the sky-high tariffs – and the risk of provoking Trump for siding with China. Beijing’s own record of economic coercion, aggressive trade practices and assertive military posturing in the region is not helping, either…

Elizabeth Economy, a senior fellow at the Hoover Institution at Stanford University, said despite China’s overtures, countries are not “jumping at the chance to partner with China.”

“For many of these countries, even when China is a larger trading partner, the United States is often a much larger export market. So they have significant stakes with the US economy as well,” she said.

China has been engaged in years of bullying, spying and threats in the South China Sea, so no wonder the other people in the region see China less as a reliable partner and more as an aggressive thug that threatens to take what it wants no matter what anyone else thinks about it. That doesn’t mean any of these countries are eager to abandon China as a trading partner but they probably won’t choose team China unless they have no other choice.