American President Donald Trump announced a reciprocal tariff policy on April 2nd, imposing a 34% tariff on Chinese goods effective as of the 9th. In response, China’s State Council unveiled countermeasures on the 4th, adding a 34% tariff on U.S. imports effective starting on the 10th.
According to an article by Luo Zhiheng, Chief Economist at Yuekai Securities based in Guangdong province, China should adopt three principles to counter Trump’s tariff war: “seeking unity through struggle,” “building an international united front,” and “strengthening China’s own capabilities.”
Luo suggests that “while China should strongly counter U.S. unilateral protectionist policies, it must also maintain dialogue mechanisms and seek cooperation opportunities.” He advocates for “uniting all possible allies, accelerating the formation of a non-dollar world alliance, and strengthening regional cooperation.”
The economist offered five specific recommendations:
1, Implement more precise and powerful countermeasures while preserving communication channels to reach interim agreements.
2, Build international communities of shared interests by strengthening cooperation with Europe, Japan, South Korea, ASEAN, Latin America, and Africa, reducing tariffs for these countries to create a non-dollar free trade system.
3, Actively expand domestic demand through additional fiscal budgets, interest rate cuts, and establishing a “Central Real Estate Stabilization Fund,” with the long-term goal of making China the world’s largest consumer market.
4, Provide relief to export-related industries and stabilize the job market.
5, Deepen reform momentum to increase potential economic growth.
Luo stated that Trump’s tariffs “aren’t based on economic rationality but rather on political electoral logic and personal power pursuits,” cautioning about the unpredictability of such an approach. He emphasized that “the long-term and severe nature of the tariff war is inevitable.”
Source: Central News Agency (Taiwan), April 8, 2025
https://www.cna.com.tw/news/acn/202504080237.aspx