Companies from China and the United States are concerned about the impact of trade tensions between the world’s top two economies after the United States began imposing a 25-percent additional tariff on Chinese products worth 34 billion U.S. dollars Friday.
China’s customs authority announced that additional tariffs for some imports from the United States worth the same amount, including agricultural products, vehicles and aquatic products, also took effect on the same day.
Chinese manufacturers and U.S. businesses operating in China have expressed concerns that the United States launching of the largest trade war in economic history could impact the global trade order and inflict losses to U.S. consumers as well as industry and commerce firms on both sides.
“We are deeply concerned over the escalated trade tensions between the United States and China,” said Bruce Blakeman, vice president of corporate affairs in Asia Pacific at U.S. agribusiness company Cargill. The transnational company has many branches and plants across China.
There are no winners in a trade war and tariff measures will not solve the concerns of the U.S. government, according to companies.
Harley Seyedin, president of the American Chamber of Commerce in South China said that the American Chamber of Commerce in South China and the U.S. Chamber in Washington continue to believe that the move puts all the burden on American and Chinese companies and consumers.
“If the status-quo is prolonged, it will have a long lasting negative impact on free and fair trade between our nations as companies affected will begin to look for alternative sources to fulfill their product needs.”
Sources of two international leading container shipping companies told Xinhua they estimated the ripple effect of the China-U.S. trade dispute to emerge in the second half of the year.
The company will cancel the business of two cargo ships next month, said an executive of one of the shipping firms, who is in charge of business in south China.
“Imposing additional tariffs will increase the costs of Chinese companies in exports to the U.S. and thus make them face greater competition pressure,” said Xiao Feng, deputy general manager of Shenzhen-based OneTouch Business Service Ltd., a subsidiary of e-commerce giant Alibaba Group.
“But on the other hand, it is difficult for U.S. distributors to find substitutes as Chinese products have reasonable prices and good quality. In the end, either the demand will be cut or the prices will be lifted in the U.S. market.”
“The two choices will either impact the supply chain or let consumers take the consequences. Both are terrible results.”
“The U.S. clients have already told us they would adjust the prices,” said an executive of an equipment manufacturing firm with exports to the U.S. in Guangdong.
Dongguan Excel Industrial Co. Ltd, another company in the province, is affected by the U.S. list of Chinese products for additional tariffs. The company’s two major U.S. clients hold a wait-and-see attitude.
“One client believes the prices will inevitably hiked, which will lead to the fall of consumption demand, while the other also considers cutting the types of products on the market,” according to Wu Tianwen, chairman of the company.
“It is nothing good. None of Chinese and American companies or consumers will benefit [from the dispute].”
China’s Ministry of Commerce warned the U.S.-initiated trade war will hamper global economic recovery and trigger global market turmoil while dealing a blow to many multinationals, enterprises and ordinary consumers.
Recent U.S. protectionist measures have also triggered opposition and counter measures from a number of countries.
China lodged an additional complaint with the World Trade Organization Friday over tariffs formally implemented by the United States based on a trade investigation against China under Section 301.
Imposing additional tariffs will not stop the upgrade of China’s manufacturing industry, say Chinese entrepreneurs.
Luo Rihui, executive director of an automation firm in Guangdong, said: “The trade dispute prompts domestic companies to speed up efforts to look for local suppliers of core parts and further enhance their strength to tap the market.
“Now, many companies seek cooperation with us. We believe we will see faster development.”
Xi Jinping, general secretary of the Central Committee of the Communist Party of China (CPC), presided over the third meeting of the central committee for deepening overall reform Friday.
Since the 19th National Congress of the CPC, the CPC Central Committee has launched major reforms of overall importance, and significant new progress has been made in comprehensively deepening reform, said Xi, also Chinese president, chairman of the Central Military Commission, and head of the central committee for deepening overall reform.
More efforts should be made on tackling key difficult issues, invigorating the system, using the experiences from the primary level and inspiring cadres to push reform deeper, said Xi.
Wang Huning and Han Zheng, both members of the Standing Committee of the Political Bureau of the CPC Central Committee and deputy heads of the reform committee, attended the meeting.
Participants at the meeting approved a number of documents:
— a guideline on supporting Xiongan New Area in Hebei in deepening overall reform and opening up;
— a guideline on creating pilot new era culture practice centers;
— a document on regulating after-school training agencies;
— a document on reforming and developing pre-school education;
— a document on enforcing budget performance management;
— a document on improving consumption stimulation system and mechanism and stimulating potential consumption capacity of residents;
— a plan to improve consumption stimulation system and mechanism (2018-2020);
— a guideline to create and improve the standards system of basic public services;
— a document on strengthening reform on the protection and use of cultural relics;
— a guideline on introducing third-party evaluation of government purchased services;
— a regulation on preventing and punishing statistical falsification;
— a document on measures related to central authorities in the “one-visit” administrative streamlining reform in Zhejiang and other regions;
— a document on the pilot promotion mechanism for management staff in public institutions at or below county level;
— a document on financial policies for promoting deeper military-civilian integration;
— a plan to set up Internet courts in Beijing and Guangzhou;
— a plan to set up a new prosecution division on public interest litigation in the Supreme People’s Procuratorate;
To deepen overall reform, more efforts should be made on pushing forward the implementation and verifying the results, said a statement released after the meeting.
“Every task should be assigned to a particular person,” said the document.
Participants in the meeting also agreed to draw up measures to inspire the cadres and support reformers in various ways.
In addition, a batch of reform pioneers should be commended in the celebration of the 40th anniversary of the reform and opening up, said the statement.
Chinese Premier Li Keqiang on Saturday called for deepening open and pragmatic cooperation between China and Central and Eastern European Countries (CEEC) to promote common prosperity and development.
Li made the call when attending the seventh China-CEEC leaders’ meeting in Sofia, Bulgaria, hailing the open, effective and inclusive nature of the 16+1 mechanism as well as its fruitful achievements.
“It has created a new model of multilateral open cooperation,” Li said.
The cooperation mechanism has consolidated the foundation for mutual trust and realized mutual benefit for both sides, and meanwhile helped promote the development of China-EU relations, he said.
Li said that at this year’s annual meeting of the Boao Forum for Asia, Chinese President Xi Jinping gave a firm signal that China will expand its opening to the outside world.
“Looking into the future, China will continue to adhere to the path of peaceful development, unswervingly pursue an open strategy of mutual benefit and win-win results, and work with other countries to build a new type of international relations and a community with a shared future for mankind,” said the premier.
“Countries are welcome to board China’s economic express to share opportunities of China’s development,” he added.
For the future development of the 16+1 mechanism, Li proposed both sides jointly safeguard economic globalization and free trade, maintain a rules-based multilateral trading system, oppose unilateralism and protectionism, and vigorously promote trade and investment liberalization and facilitation.
He suggested more CEE countries participate in the construction of various forms of industrial parks according to their own advantages, and foster fresh force for innovation cooperation.
Financial cooperation should be enhanced to open up more investment and financing channels for the 16+1 cooperation to solve financing difficulties, according to Li. He invited CEEC financial institutions to launch branch offices in China for business.
The premier also called for upgrading local cooperation and stepping up cultural and people-to-people exchanges between the two sides.
The CEEC leaders fully acknowledged the fruitful achievements of the 16+1 cooperation and spoke positively of the cooperation initiatives proposed by Li.
All parties agreed that the 16+1 cooperation is not a geopolitical tool, but a pragmatic cooperation platform where cooperation is carried out in accordance with EU rules. It will benefit both China and the CEEC and facilitate Europe’s integration process, thus being conducive to strengthening rather than weakening the EU.
The parties expressed their willingness to continue to uphold the notion of open cooperation, equal consultation, mutual benefit and win-win cooperation, strengthen cooperation in the areas of economy, trade, investment, transportation, energy, tourism, education, and between local areas to maintain multilateralism and free trade, and oppose protectionism, so as to promote the 16+1 cooperation for new progress.
After the meeting, Li joined Bulgarian Prime Minister Boyko Borissov, host of the 7th China-CEEC leaders’ meeting, and Prime Minister Andrej Plenkovic of Croatia, the next host country, in a press conference.
China and CEEC jointly issued an guideline for their cooperation, and the leaders witnessed the signing of more than 20 cooperation documents. Li and Borissov also unveiled the China-CEEC agricultural demonstration zone.
Latest posts by S. Jack Heffernan Ph.D (see all)
- Asian Market Update - October 25, 2019
- American Airlines Up, Evidence the Trump Economy is Strong - October 24, 2019
- Google Under Siege in France - October 24, 2019