Chinese state media warns retaliation against US tariffs could ‘become routine’

Chinese state media has warned the countermeasures Beijing is taking against Washington’s increased tariffs and technology containment strategy could “become routine”.

In a commentary on Friday, Taoran Notes – a social media account affiliated with official newspaper Economic Daily – also sought to play down expectations that an anticipated meeting between the Chinese and US leaders later this month could get trade negotiations back on track.

It listed areas where China could strike back against the duties and other moves such as a ban on US companies supplying technology to Huawei. Those areas included exports of rare earths, which are used in nearly all hi-tech products, and its “unreliable” entities list.

“China is showing its determination and capability when it comes to genuine ‘battle preparations’, and these countermeasures will gradually become routine,” the commentary said. “After that, every countermeasure [Beijing takes] will be more foreseeable and rules-based.”

Tensions have been rising between Washington and Beijing after trade talks stalled last month, with China in recent weeks announcing it would blacklist “unreliable” foreign entities deemed to have damaged the interests of Chinese firms, issuing a US travel advisory, and setting up a measure to protect technology firms.

State media – including People’s Daily, national broadcaster CCTV and Xinhua news agency – responded with a volley of criticism after US President Donald Trump abruptly raised tariffs to 25 per cent on US$200 billion worth of Chinese goods on May 10. Beijing retaliated by increasing duties on US$60 billion of American imports.

China has yet to give further information on which businesses could be affected by its “unreliable” entities list, announced on May 31, and what specific measures they would face. There has been speculation that it could include delivery services firm FedEx, which is being investigated by China’s postal regulator after Huawei accused it of unauthorised re-routing of its packages.

China’s countermeasures come ahead of a possible meeting between President Xi Jinping and Trump on the sidelines of the Group of 20 summit in Osaka, Japan on June 28-29.

But on Friday, Trump told Fox News that “it doesn’t matter” if Xi agrees to meet him to restart trade talks or not, because the US was collecting billions of dollars in tariffs on goods from the country.

“If he shows up, good,” Trump said. “If he doesn’t – in the meantime, we’re taking in billions of dollars a month.”

He added: “Eventually, they’re going to make a deal, because they’re going to have to. Look, they’re paying hundreds of billions of dollars.”

Bloomberg meanwhile reported that US Vice-President Mike Pence was due to give a speech critical of China’s human rights record on June 4 but it was delayed by Trump. The speech was put off to avoid upsetting Beijing ahead of the potential meeting with Xi, the report said, citing sources familiar with the matter. The speech has been tentatively rescheduled for June 24, just before the G20 summit, but there is still debate within the administration about when Pence should deliver it and how hard he should be on the Chinese, according to the report.

China’s foreign ministry has yet to confirm the meeting between Xi and Trump in Osaka, and the Taoran Notes commentary said the ball was firmly in the US court.

“If the US side can return to the starting point of the consensus reached by the leaders in Argentina and substantially address China’s core concerns with equal treatment and mutual respect, the likelihood of negotiations will obviously get bigger,” the commentary said, referring to the Trump-Xi meeting in Buenos Aires in December.

But “if some people from the US side are still playing the old trick of maximum pressure … any meeting and talks will be in vain”, it said.