President Trump has repeatedly singled out China for the kind of unfair trade he aimed to curb Thursday when smacking tariffs on steel and aluminum imports. But in the fallout, China is the one emerging relatively unscathed.
President Trump has repeatedly singled out China for the kind of unfair trade he aimed to curb Thursday when smacking tariffs on steel and aluminum imports. But in the fallout, China is the one emerging relatively unscathed.
Trump gave a reprieve to Canada and Mexico, for now, and suggested allies such as Australia also may receive exemptions. Countries around the globe, including Japan and South Korea, scrambled to get on the list. Leaders loudly condemned the move, which threatens to explode into a trade war and rupture America’s most important alliances in Asia.
“This is not just about Japan,” said Ken Onuki, director of general affairs at the Japan Aluminum Assn. “It’s a violation of free trade.”
Japan’s trade minister called the decision “extremely regrettable,” and South Korean officials said they might lodge a protest with the World Trade Organization.
China, the world’s largest producer of steel and aluminum, denounced the tariffs as an affront to the international trade order. The country will take “effective measures” and safeguard its rights based on the damage caused, the Ministry of Commerce said on its website.
It probably won’t feel much. China accounted for about 2.5% of U. S. steel imports last year, a result of previous restrictions. It exports a fraction of the aluminum the U. S. receives.
“It seems the U. S. administration keeps on shooting at the wrong target,” Hong Kong-based analysts Alicia Garcia Herrero and Jianwei Xu said in a research note for Natixis, a French investment bank.
Chinese officials routinely warn about the reciprocal damage of a trade war, but kept fairly quiet about the tariffs in the lead-up to Thursday. China views it as a welcome distraction, analysts say, from more biting tariffs on industries such as high-tech or semiconductors. Officials appear more anxious about the results of an American investigation into China’s intellectual property practices.
“China is definitely happy to let the other countries fight this battle for them,” said Andrew Polk, co-founder of Trivium/China, a Beijing-based research firm. “The reaction to the tariffs couldn’t have played into China’s hands any better.”
The nation’s rapid industrial growth helped create a global glut that, American steelmakers attest, has driven down prices and hurt U. S. jobs. Trump believes China delivers more steel to the U. S. via a third-party country, a process known as transshipping.
It’s “a big deal,” he said at a news conference this week. But little evidence proves this actually boosts China’s steel exports to the U. S.
“From the U. S. perspective, Korea appears to be like the gateway for the transshipment from China to U.
