Roving Periscope: The Eagle may, after all, force the Dragon to blink first!
Virendra Pandit
New Delhi: With little tangible results emerging in its trade war against the US, a softening China may start a phased climb down and blink first to arrive at a compromise on tariffs with the world’s largest economy, if only to retain its second place.
For now, however, Chinese President Xi Jinping has embarked upon a round of tours in South East Asia, including former enemy Vietnam, to muster support against what US President Donald Trump has ridiculed as attempt to “screw” America. Despite empty rhetoric, no key economy has spoken against the US.
On the contrary—and even before Trump’s 90-day pause started—many countries, including India, were already engaged in trade talks with the US, indicating which way the wind was flowing. In the next three months, some of these countries are expected to ink mutually-beneficial agreements, thus further isolating China.
Even the European Union (EU), on which China had pinned high hopes, has slipped into a wait-and-watch mode for 90 days, and trying to balance its position between Russia and America—China will come later.
So far, President Trump has succeeded in his trade war against China and isolated the Dragon while embracing others. By the time he meets his counterparts from India, Australia, and Japan in the proposed Quad Summit this year, the US President might have struck trade deals successfully. China denounces Quad (Quadrilateral Security Dialogue) as an “Asian NATO” targeting Beijing.
That is why a rattled China may have, after its trademark bravado and rhetoric, started a subtle climb down from its earlier position.
For example, its Commerce Ministry on Thursday urged the United States to stop putting “extreme pressure” on Beijing and “demanded respect” in any trade talks,
These remarks came while the two sides remained at an impasse over who should start those talks, particularly after the White House on Thursday published a fact sheet stating that China now faces up to a 245 percent tariff.
Beijing criticised the tariffs as irrational and said it will ignore the “meaningless” tariff numbers game.
Recently, it also warned that China will “fight to the end” if the US insists on heaping substantial damage on China’s “rights and interests.”
“The unilateral tariff increases were entirely initiated by the United States,” He Yongqian, a Chinese commerce ministry spokesperson, told a weekly news conference.
Unlike multiple nations that have responded to Trump’s “reciprocal tariffs” by seeking deals with Washington, Beijing has been upping its own levies on US goods in response and has not sought talks, which it says can only be conducted on the basis of “mutual respect and equality,” something that China itself denies other countries.
Washington said on Tuesday that Trump was open to making a trade deal with China but Beijing should make the first move and that “the ball is in China’s court.”
“We urge the United States to immediately stop extreme pressure, coercion and blackmail, and resolve differences with China through equal dialogue on the basis of mutual respect,” the spokesperson said.
The commerce ministry has been maintaining working-level communication with its US counterparts, she said, adding that China is open to economic and trade consultations with the United States.
But “the person who tied the bell must be the one who unties it,” she said, using a Chinese proverb.
