No one will win in a US-China trade war

No one will win in a US-China trade war

But things looked worse at the end of last week, when Trump threatened to impose tariffs on an additional $100 billion in Chinese goods.

Xi said China would raise the foreign ownership limit in the automobile sector "as soon as possible" and push previously announced measures to open the financial sector.

Beijing did not want to fight a trade war, but was not afraid of one, Vice Commerce Minister Qian Keming said at the Boao Forum for Asia in the southern province of Hainan.

The reality is that the USA economy was largely open by the 1980s and that every major trade agreement has reduced other nations' trade barriers by far more than it altered American trade barriers.

China is positioning themselves as responding to U.S. aggression rather than taking a lead in punishing the U.S. In a statement, the Chinese embassy in the United States said, "As the Chinese saying goes, it is only polite to reciprocate", adding that China intends to pursue the matter with the World Trade Organization and enact "corresponding measures of equal scale and strength against U.S. products".

Speaking at the Boao Economic Forum in China, Xi pledged to "significantly lower import tariffs" for vehicles and "significantly broaden market access" for foreign companies, the Washington Post reported.

Investors across the globe are bracing for uncertain markets over an escalating trade dispute between the USA and China.

"The expectation was this could have gone one of two ways: he could have been aggressive about US tariffs or been conciliatory, and it feels like he's more conciliatory", said Art Hogan, chief market strategist at Wunderlich Securities in NY.

Karst added: "This latest trade action [by China], if it is on soybeans, if it does come about, it will have a devastating impact on USA soy farmers, and by extension all United States farmers".

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Farmers "are great patriots", Trump said at the White House.

Xi's choice of vehicles as a specific product class was telling as a message to Trump; the USA president used precisely the example of Chinese tariffs on cars in voicing his grievances about Chinese trade practices. Xi also said that China does not foist unfavorable deals on any countries. Even with the US tariffs, China can still reach its 2018 GDP growth target of around 6.5 percent and the impact on employment will be limited, Wang Changlin, a researcher at the National Development and Reform Commission (NDRC), wrote in a post on the commission´s official microblog account.

The probe concluded that China systematically tries to unfairly acquire US intellectual property by requiring that Americans doing business there agree to joint ventures with Chinese nationals and transfering key technology to them.

However it added a full-blown trade war "would have a more pronounced effect".

Also Tuesday, China filed a WTO challenge against Trump's earlier tariff hike on steel and aluminum in a separate dispute.

In apparent, if unacknowledged, answer to some of the U.S.'s criticisms, President Xi said China would increase imports, improve the protection of intellectual property and provide a more transparent, rule-based environment for foreign investment.

"We're going to protect our farmers", he said.

The biggest beneficiaries of a cut in China's 25 per cent tariff on most auto imports will be the small number of automakers such as electric vehicle brand Tesla that have no factory in China. China has promised repeatedly to open up sectors such as financial services.

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