China Briefing | In Trump’s trade war on China, the winner will be whoever can stand to lose the most
There’s an old Chinese saying that in a war, one must prepare to lose 800 of their own to kill 1,000 of the enemy’s men – and that means both countries will end up battered, bruised and bloody
His bravado is being put to a true test. Last week, he escalated the trade war with China by beginning the process of imposing tariffs on a further US$200 billion of imports from his principal target.
This came after the US slapped 25 per cent tariffs on US$34 billion in Chinese imports, forcing Beijing to respond in kind by imposing similar taxes on US$34 billion in US products.
Trump’s trade war on China: phoney or real, world will be the loser
Trump already threatened to impose tariffs on all US$500 billion in Chinese imports, much more than China exported to the US last year – if Beijing would not bow to US demands.
Responding to the latest threat, the Chinese commerce ministry expressed shock, condemned the irrational behaviour and vowed to take countermeasures.
As the latest development rattled the financial markets worldwide, the question is: how will the trade war end and will Trump’s boast prove true? The answer is easy. No one wins a trade war, and this can be illustrated by an old Chinese saying that in a nasty war, one must prepare to lose 800 of their own to kill 1,000 of the enemy’s men.
To see why Trump’s tariffs have hit a Chinese nerve, read history
The rub is which side would have better capacity and determination to stomach the dire consequences if the war continued to worsen.