China’s commerce minister said on Sunday that Beijing and Washington are still holding economic talks. He warned that a trade war would harm both nations.
“There are no winners in a trade war, and it would bring disaster to our two countries as well as the rest of the world,” Minister of Commerce Zhong Shan said.
Chinese leaders have threatened in the past to retaliate against raised trade barriers, but have yet to take direct action following Trump’s announcement but vowed to defend China’s national interests in the face of growing American protectionism.
“China does not wish to fight a trade war, nor will China initiate a trade war, but we can handle any challenge and will resolutely defend the interests of our country and our people,” Shan said.
President Xi Jinping’s top economic advisor, Liu He, held trade discussions with US officials at the White House earlier this month but the meetings yielded few breakthroughs.
US President Donald Trump has since announced 25 percent tariff on imported steel and 10 percent on aluminum imports, drawing threats of retaliation from China and other nations.
“We are continuing our discussions,” Commerce Minister Zhong Shan said during a press conference held on the sidelines of the annual parliamentary session underway in Beijing.
“Because no one is willing to start a trade war, and everyone knows trade wars hurt others without helping themselves,” Zhong said.
That may not reflect the current mood in Washington. Last week, Trump tweeted the US could win a trade war.
The U.S. reported a $375 billion deficit with China last year, so a 20 percent reduction would still be among the largest trade gaps that the U.S. has with any country.
Zhong also took issue with the statistics behind the trade imbalance – which showed a record $375.2 billion US deficit with China during Trump’s first year in office.
He cited American government research that he said showed the figure for the surplus in China’s favor overstated by roughly 20 per cent and said that if the US dropped restrictions on high tech exports such as supercomputers and advanced materials with military applications to China it would further reduce the surplus by 35 per cent.
U.S. officials have said such sales would make up only a few percent of the deficit while possibly threatening American national security.
“There is still much for us to do, one side cannot call the shots, we need to work hard together,” Zhong said.