China on Wednesday unveiled a list of imported products from the United States worth $50 billion that will be subjected to higher tariffs, including soybeans, automobiles, aircrafts and chemical products. The decision, made by the Customs Tariff Commission of the State Council, could also involve an additional 25 percent tariff on 106 items under 14 categories.
This is Beijing's clear show of retaliation toward the proposed tariff list on Chinese products from the US. Beijing showed an impressive response time for its retaliation efforts, taking less than 12 hours to announce its trade countermeasures. Chinese officials agree that its country's countermeasures match those imposed by the US and that they showcase China's determination to win this trade war.
It is worth noting that China strikes the US side by targeting its most valuable imports, such as soybeans, automobiles and chemical products. These aspects were targeted because they represent key pillars in the US imports and can create a massive weak spot for the US economy if their profitability is at risk.
Although China will sustain financial losses thanks to the US' Section 301 investigation tariffs, they will pale in comparison to the damage done to the US economy via China's retaliations.
China's counter tariffs are a spectacular way of standing up to America's bullying tactics, not only for itself, but for other countries threatened by the US's new trade policies.
Hawkish politicians in Washington have obviously overestimated the capability and endurance of the US economy in a trade war, since they believe they can do whatever they like. China has shown a great deal of restraint for now, but if the US persists in this trade war, China is ready to fight to the end.
Washington will eventually see what they have lost, thanks to their actions, and it will only serve to embarrass the US. This trade war will serve as a good example to the US that it cannot use intimidating trade tariffs as a form of diplomacy.
Before China announced its recent retaliatory tariffs on US products, Washington enjoyed crushing and threatening other countries on trade sanctions. Now, as China deploys its counterattack, the pleasure that the US achieved from those tariffs will now cause them suffering as their financial and political gains diminish to zero.
China and the US have an almost identical market size, and companies from both countries are trading on voluntary principles. This relationship is an obvious choice since it provides both countries with positive outcomes for its commercial interests.
It is unfounded to describe the US as a victim in its bilateral trade agreements with China and then say that the US can inflict more damage to China by sabotaging its trade relations. If a full-blown trade war is started between the two countries, both will secure losses.
Many believe that the Trump administration's $50 billion tariff on Chinese products is meant to pressure China to submit to the US demands. If that is the case, the US will undoubtedly lose. This is because the Chinese government has rallied its citizens and is prepared to go toe-to-toe in its fight with Washington. In fact, more and more Chinese citizens think that an "epic trade war' is inevitable, and could knock some common sense into the US government, so that it will change its way of dealing with China.
If the trade war happens, China will show that it has just as many reserve plans as the US, if not more. Chinese experts suggest that China could even take actions to weaken the strength of its currency. Since China is the world's largest trading economy and the largest buyer of commodities like oil products, China could use its influence to push its own currency, RMB, in global markets to reduce the dominance of the US dollar. That would be a heavy blow to Washington.
If this trade war comes to pass, it will be an evenly matched total war between China and the US economies, and not some small scuffle. It would be delusional for the US to think it will be victorious at the end of this trade war. China comes up with the conclusion in confidence, and will not shy away from letting Washington know in this situation.