China-US Trade War ‘Only A Proxy For Larger Battle For Dominance Between Two Powers’

** Washington is due to start charging tariffs on $34 billion in Chinese imports as of Friday

** Beijing has pledged to retaliate with equal tariffs on $34 billion in US goods

JUL 3, 2018 (BE2C2): China said Tuesday it is “fully prepared” for a trade war with the US as hopes dwindle for a breakthrough in tensions this week between the world’s two biggest economies.

Washington is due to start charging tariffs on $34 billion in Chinese imports as of Friday July 6 while Beijing has pledged to retaliate with equal tariffs on $34 billion in US goods.

Foreign Ministry spokesman Lu Kang told reporters that China is “fully prepared to take a package of necessary measures” to safeguard its national interests.

The comments from the Foreign Ministry mark the latest escalation in the U.S.-China trade war.

Deng Yuwen, a political commentator and international relations scholar says the trade conflict is only a proxy for the larger battle for dominance between the two powers. With all signs pointing to a Chinese government determined to fight back, given that its goal of national rejuvenation is at stake, China is unlikely to cave in to US pressure.

“The US sees the trade war as a tactic to contain China. So does Beijing.”

US companies ranging from soybean farms to whiskey distilleries to automakers like Ford and Tesla could suffer if China ramps up retaliatory measures. China’s list is designed to inflict pain on US farmers and other groups that are important to President Donald Trump’s political base, according to AP.

Trade friction also threatens to ensnare major Chinese companies, with China Mobile the latest to encounter obstacles in the US market. A US agency under the Department of Commerce recommended Monday against giving operating licenses to China’s largest telecom carrier, citing national security risks posed by the state-run firm.

China’s stock market has fallen nearly 10 percent in recent weeks on fears of a trade war while its currency has dropped sharply against the US dollar.

Business Insider on Tuesday reported that China ordered its state media to censor comments from President Trump in light of the trade conflict.

Responding to questions over a safety warning to Chinese citizens traveling to the United States issued by the government late last week, Lu, the foreign ministry spokesman, said the government was merely fulfilling its duty to warn travelers of “potential dangers.”

The warning to Chinese travelers noted the high cost of medical treatment in the US, the importance of guarding against crime and terrorist attacks and the considerable powers wielded by Immigration and Customs Enforcement agents.

Trump has accused China of unfairly acquiring US technology through coercion and theft and limiting market access for US finance and technology firms — claims that China denies.

China accuses Washington of protectionism, pointing to the struggles of Chinese companies like China Mobile and telecoms equipment maker ZTE, which briefly shut down in April after the Department of Commerce temporarily banned it from purchasing US chips.

Trade War A Proxy For Larger Battle For Dominance Between Two Powers

According to Yuwen, this trade war must be seen in the larger context of a shift in America’s perception of China. Many experts, scholars and even regular folk, he says, recognize that the Trump administration’s targeting of Chinese trade is not being done on a whim; it is supported by the two political parties, Congress and the US public, including the business sector.

In other words, says Yuwen, the whole of American society appears to have reached a consensus on a new approach to dealing with China. For the first time in 40 years, the US now sees China as a rival nation to be contained and beaten, says Yuwen. This view is reflected in the US security strategy unveiled late last year, in which China was named as a major competitor seeking to challenge US power and undermine its interests.

“To use the language of the hawks in US policy circles, China is now the enemy.” So, it’s not surprising at all that President Trump has taken such an uncompromising stance on trade against China. While divergent views within the administration may emerge on occasion, the general trend is clear: the China hawks are on the ascent.

As for how China is looking at the impending trade war: On June 21 in Beijing, President Xi Jinping met a group of chief executives of mostly American and European multinationals. According to The Wall Street Journal, he told them that China would strike back at US trade tariffs. “In the West, you have the notion that if somebody hits you on the left cheek, you turn the other cheek,” Xi reportedly said. “In our culture, we push back.”

Also in the report, a Chinese official promised that Beijing would be unyielding in its approach to Washington. “China is not going to yield to outside pressure to eat the bitter fruit,” the official said. “That’s the negotiation principle set by President Xi.”

In the past, such meetings were hosted by the premier, but this year Xi attended instead – a sign of China’s determination to get its message across: it is ready for the trade war.

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