“Trade Deals Are off If US Raises Tariffs” – China

Continuous tension between the US and China, which raises the odds of a trade war, is increasing as China has balked at stepping up its purchase of American products, if US President Donald Trump follows through on his threat to tax billions of dollars’ worth of Chinese imports.

"If the United States introduces trade sanctions including a tariff increase, all the economic and trade achievements negotiated by the two parties will not take effect," said a Chinese government statement. The negotiating process should be "based on the premise" of not fighting a "trade war," the statement added.

China’s warning came after the talks on Beijing’s pledge to narrow its trade surplus led by US Commerce Secretary Wilbur Ross and China’s top economic official Liu He.

After the event, Ross said that the two sides discussed specific American exports China might purchase. However, the talks ended with no joint statement and both sides had not released details.

Professor of trade policy at Cornell University Eswar Prasad said, “Both sides appear to have hardened their negotiating stances and are waiting for the other side to blink.”

"Despite the potential negative repercussions for both economies, the risk of a full-blown China-U.S. trade war, with tariffs and other trade sanctions being imposed by both sides, has risen significantly."

The US threatened to impose tariffs on up to $50 billion of Chinese products in a dispute over Beijing’s move to challenge US technological dominance.

China, on the other hand, targeted $50 billion in US products for possible retaliation.

On May 19, China promised to significantly increase its purchase of US farm, energy, and other products. Steven Mnuchin, Treasury Secretary, said that then that the US tariffs were suspended and the trade war was “on hold”.

The ceasefire made the shaking global market in relief.

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