China’s Commerce Minister: U.S. has the Most to lose in a Trade War
China’s commerce minister warned the United States on Sunday that if it launches a “trade war” against China by levying punitive tariffs on Chinese imports, the United States will suffer the most.
Chen Deming also said the U.S. government’s “obsession” with China’s exchange rate could not be seriously addressed until it stopped blocking the export of high-tech products, such as supercomputers and satellites, to China. “If some congressmen insist on labeling China as a currency manipulator and slap punitive tariffs on Chinese products, then the [Chinese] government will find it impossible not to react,” Chen said in an interview with The Washington Post. “If the United States uses the exchange rate to start a new trade war, China will be hurt. But the American people and U.S. companies will be hurt even more.”
Chen’s comments, made during an interview Sunday, reflect the exasperation within the Chinese leadership regarding the United States’ attempt to push China to allow its currency, the yuan, to rise against the dollar. In addition, Chen’s remarks also underscore how China is seeking to use the current trade dispute with the United States to push its own agenda in Washington — to eliminate, or at least ease, the 20-year-old sanctions that limit American exports to China.
President Obama has contended that if China lets the yuan appreciate, U.S. exports would increase. Sen. Charles E. Schumer (D-N.Y.) is authoring legislation that would place tariffs on Chinese goods if China does not allow its currency to float more freely. On April 15, the Treasury Department is scheduled to release a report on worldwide currencies. Chen said the Chinese government does not want to be labeled a “currency manipulator.”