China-US relations

Hong Kong vows to hit back against any ‘discriminatory’ US trade actions

Commerce chief says trade row may have spillover effect – and it could push China to find other partners and new markets, according to observers

PUBLISHED : Friday, 23 March, 2018, 6:55pm
UPDATED : Friday, 23 March, 2018, 11:03pm

Hong Kong will fight back against any discriminatory trade actions brought by US President Donald Trump’s plan to impose US$60 billion in tariffs on Chinese imports, a senior commerce official said on Friday.

The remarks by Secretary for Commerce and Economic Development Edward Yau Tang-wah came as observers said Trump’s move would do more harm than good, and may push China to find new markets.

“If anything is imposed on Hong Kong in a unilateral and discriminatory way, such as on aluminium materials, Hong Kong will not hold back – we will voice our strong disapproval ... We have made this clear bilaterally and multilaterally,” Yau told the South China Morning Post.

“We need to be concerned because both the US and mainland China are our major trading partners ... and there will be a spillover effect on their trading partners,” he said, adding that the Hong Kong government would closely monitor tariffs imposed by the United States and China on each other’s goods.

Trump’s latest round of tariffs has also added to concerns in Japan. While most US allies were exempted from levies unveiled earlier this month on steel and aluminium, Japan was not. But Japanese trade minister Hiroshige Seko said on Friday that retaliation against the measures could destroy the free-trade system.

China strikes back with tariffs on US goods after US$60 billion penalties

US-China Business Council president John Frisbie said American companies wanted to see solutions on issues like intellectual property infringements and forced technology transfers in China, but added that unilateral tariffs could do more harm than good.

“We urge the two governments to engage in results-oriented dialogue to bring about real, positive change … and any actions taken be consistent with the United States’ international obligations,” said Frisbie, adding that mutually beneficial trade ties were a source of stability for US-China relations.

Wang Yiwei, an international relations expert from Renmin University in Beijing, said the tariffs package would not bring the changes to China’s trade practices that Trump wanted, but would instead push Beijing to seek other partners and bigger markets.

China ‘will fight to the end’ in trade war, Beijing warns after Trump hits country with $60b in tariffs

Trump on Thursday lambasted China for its industrial policy and said he had demanded immediate action from Beijing to reduce its trade surplus with the US by US$100 billion, announcing the trade actions to counter China’s “economic aggression”.

Hours later, China’s embassy in Washington issued a statement saying Beijing would fight to the end to defend its legitimate interests, taking all necessary measures.

On Friday, the commerce ministry said China would impose 15 per cent import tariffs on 120 types of US products – including fruit, wine and steel pipes – worth US$977 million, and 25 per cent levies on another eight categories of imports worth US$2 billion, including pork and recycled aluminium.

‘Collateral damage to Hong Kong unavoidable’ from US-China trade war, city’s commerce chief says

Robin Xing, chief China economist at Morgan Stanley, said during a conference call on Friday that Beijing’s response had been “moderate and measured” and that its retaliation was expected to be of limited scope, noting that sensitive products such as soybean were not on the list.

“They are trying to deal with this cautiously … [China] is trying to retaliate without doing too much damage to overall imports,” Xing said.

“Any big disruption to imports of agricultural goods may cause some inflationary pressure in China.”

But one former commerce official warned that if the confrontation escalated, China would not hold back. “There will be further retaliatory measures from China, and China is not short of tools it can use to counter this,” he said.