China Responds: “Not Afraid Of Trade War”, Vows To “Fight To The End”

China Responds: “Not Afraid Of Trade War”, Vows To “Fight To The End”:

Earlier today we laid out the various ways in which China can retaliate to today’s official start of trade warfare between Washington and Beijing (of which the “trade war heavy” scenario was especially troublesome), and said that at this point all there is to do is watch and wait as China unveils next steps.

It did just that when the Chinese Embassy in the US issued a statement in response to the “Section 301” investigation, in which it said that the US, “ignoring rational voices” has engaged in a “typical unilateral trade protectionist action” which “China is firmly opposes.”

The embassy then said that while China “does not want a trade war with anyone”, it is “not afraid of and will not recoil from a trade war.” Furthermore, Beijing is “confident and capable of facing any challenge.”

It then warns Trump that “if a trade war were initiated by the U.S.” which it just was a little after noon Eastern, “China would fight to the end to defend its own legitimate interests with all necessary measures.

Ultimately, China warns that “the actions undertaken by the U.S. are self-defeating. They will directly harm the interests of U.S. consumers, companies, and financial markets. They also jeopardize international trade order and world economic stability.

And in a plea that will fall on deaf ears in the White House, Beijing concludes by urging the U.S. “to cease and desist, make cautious decisions, and avoid placing China-U.S. trade relations in danger with the purpose of hurting others that eventually end up hurting itself.”

Translation: China will retaliate imminently, at which point – in typical tit-for-tat fashion – the US would respond in kind again, until the worst-case scenario envision by Deutsche Bank emerges.

The silver lining: this trade war will be used by the Fed to first delay and then call of the rate hike cycle entirely, in the process perversely validating Trump’s claim that trade wars are, drumroll, bullish.

Full statement below:

Statement of the Chinese Embassy in the United States regarding the “Section 301 Investigation”

The United States persisted in conducting the “301 investigation” and announced relevant trade measures, ignoring rational voices, and in disregard of the mutually-beneficial nature of China-U.S. trade relations and the consensus reached by the two countries of managing differences constructively through consultations. It is a typical unilateral trade protectionist action. China is strongly disappointed and firmly opposes such an action.

Bearing in mind the principles of mutual respect and win-win cooperation, China has demonstrated sincerity in making reasonable suggestions to the U.S., and has made great efforts to address the current trade imbalance between China and the U.S. China does not want a trade war with anyone. But China is not afraid of and will not recoil from a trade war. China is confident and capable of facing any challenge. If a trade war were initiated by the U.S., China would fight to the end to defend its own legitimate interests with all necessary measures.

The actions undertaken by the U.S. are self-defeating. They will directly harm the interests of U.S. consumers, companies, and financial markets. They also jeopardize international trade order and world economic stability.

We urge the U.S. to cease and desist, make cautious decisions, and avoid placing China-U.S. trade relations in danger with the purpose of hurting others that eventually end up hurting itself.

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