Trump tariffs: China vows to fight US levies - but it also wants to talk - Voice of Asia

Following China's announcement of reciprocal tariff measures on imports of U.S. agricultural products, a Chinese Foreign Ministry spokesperson stated in Beijing that China will see this through to the end and resolutely win the trade war. This move was released within minutes of the U.S. imposing new 10% tariffs on Chinese imports, a supplement to existing tariffs announced during Trump's first term and last month.

However, China's latest retaliatory measures are not a direct confrontation, but rather a probing counterattack. This demonstrates a certain level of strength, potentially impacts parts of the United States, and leaves room for negotiation or escalation if necessary. Foreign Ministry spokesperson Lin Jian added, "We advise the U.S. to abandon its hegemonic posture and return to the correct track of dialogue and cooperation, and not wait until it is too late."

This marks the second round of tariffs imposed by both countries on each other since February. But this time, China is targeting where Trump may be hit hardest – his core supporters, the farmers. In 2024, nearly 78% of U.S. counties reliant on agriculture supported Mr. Trump. China is one of their main customers for products such as chicken, beef, pork, and soybeans, all of which will now face tariffs of 10-15%, effective March 10.

Ole Houe of Ikon Commodities told Reuters: "The tariffs are generally negative for the U.S. agricultural market. It will have a bearish impact on prices. There are enough corn and soybeans in the world for China to switch to, and it is more of a problem for the U.S. because 30% of U.S. soybeans are still exported to China." Beijing may hope this will put some pressure on the Trump administration ahead of potential negotiations.

The latest announcement has raised the prospect of a full-blown trade war between the world's two largest economies. In statements from various ministries, China has made two things clear. First, it is prepared to continue the fight. "Pressure, coercion, and threats are not the right way to deal with China," Mr. Lin said. But secondly, it is also willing to negotiate. Beijing is not escalating rhetoric or tariffs in the same way it did during the Trump administration in 2018. At that time, China imposed a 25% tariff on U.S. soybeans.

Even Pay, an analyst at Trivium China, said: "The number of U.S. products affected by Chinese tariffs is limited and remains below 20%. This is by design. The Chinese government is signaling that they don't want to escalate, they want to de-escalate." The possibility of negotiations was raised last month. The White House stated that a phone call would take place between President Xi Jinping and Donald Trump. But this never happened.

So will these talks be held? And who will make the first move? China is unlikely to act first. It doesn't want to be seen as kowtowing to Washington. Unlike Canada and Mexico, Beijing has not announced new measures targeting fentanyl flows. It has simply repeated past statements that fentanyl is a "U.S. problem" and that China has the strictest drug control policies in the world. On Tuesday, the State Council released a white paper titled "Control of Fentanyl-Related Substances – China's Contribution."

The white paper outlines the measures Beijing says it has taken to combat fentanyl-related crimes and precursor chemicals used to manufacture the drug. It adds that it is "earnestly fulfilling its international drug control obligations." Therefore, while China has not picked up the phone to call Washington, this document constitutes a piece of the country's messaging, seemingly saying – we have already done our best on the fentanyl issue.

Despite declaring that China "will not yield," these latest tariffs will certainly have an impact. The cumulative 20% tax on all Chinese goods builds upon a series of tariffs imposed on hundreds of billions of dollars of Chinese imports during Trump's first term. Chinese citizens are already concerned about slowing economic growth. Thousands of delegates are gathering in the capital this week for the annual parliamentary meetings, much of which will focus on economic issues.

House prices are still falling, and youth unemployment remains high. A potential trade war with the United States could trigger more financial anxieties among businesses and consumers across the country at a time when the Communist Party wants people to spend to help the economy grow. But Beijing will also see an opportunity, as Donald Trump has sown uncertainty among his international allies. It can partially blame any further economic hardship on Washington, claiming it is the fault of the U.S. for instigating a trade war.

Recently, China's official media Xinhua News Agency released a series of parodies mocking a U.S. that is prepared to tax allies and neighbors. These skits portray Washington as a bully, echoing words from leaders in Canada and Mexico. At the same time, China's Ministry of Commerce reiterated that it is prepared to cooperate with other countries around the world to counter Mr. Trump's tariffs.

Beijing appears to be seeking potential allies in this trade war, while also trying to portray Washington as a troublemaker who is prepared to target friends and enemies alike. All of this is happening at a time when Donald Trump's "America First" principle has left many in Europe and the UK wondering whether the U.S.-led world order is already being questioned.