Heightened trade tensions between the U.S. and China over the last few days, that seemed to catch many media outlets and pundits off-guard, were actually always lurking just beneath the surface. U.S. negotiators had indeed made headway with China in talks over the last several weeks, provoking even optimism from President Trump just days before he increased tariffs on some $200 bn worth of Chinese goods from 10 percent to an economically damaging 25 percent.
However, U.S. negotiators pushed too hard. White House economic adviser Larry Kudlow said on Sunday that China needs to agree to “very strong” enforcement provisions for an eventual deal and the sticking point in negotiations was Beijing’s reluctance to put into law changes that had been agreed upon. He added that U.S. tariffs would remain in place while negotiations remain.
Major changes to Chinese law, enforced and monitored by another country is something China will never accept nor could it if it wanted to not only save face at home but abroad.
To do so would be an unacceptable concession for the country that is still sensitive to what it considers years of subjugation from foreign powers until at least the mid part of the last century – a topic that is not only still taught to every Chinese student but which has become part of the Chinese national psyche.
Beijing fires back
On Monday, China fired back. A commentary in the Communist Party’s People’s Daily said “at no time will China forfeit the country’s respect, and no one should expect China to swallow bitter fruit that harms its core interests.” The hawkish Beijing-based Global Times, which often expresses the view of the Chinese Communist Party (CCP), said that China had no reason to fear a trade war with the U.S.
A commentary in Chinese state-run news agency Xinhua, citing Chinese academics at a think tank over the weekend, said that facing U.S. tariff hike threats, China has adhered to its bottom line, defended national dignity and people’s interests. Imposing new tariffs goes against the will of the people and the trend of the times. China has the resolution, courage, and confidence to rise to all sorts of challenges, they said.