讀後心得

Trump and Xi Jinping are unwilling to back down in the trade war, with American companies facing import tariffs from China as high as 34%, particularly hitting agricultural products hard. China recently imposed tariffs of 10% to 15% on American agricultural products, further squeezing the market for these goods. With the global supply chain being highly internationalized, economic turmoil could have widespread effects. China's recent announcement of countermeasures indicates a refusal to ease its stance against U.S. policies. At this time, Xi Jinping emphasizes a firm position, possibly seeking to expand trade opportunities with other countries, further undermining the competitiveness of American companies.

Trump and Xi Jinping both seem unwilling to back down in the tariff war. American companies want to enter the vast Chinese market but face significant challenges. The 34% import tariff on all American goods could make it difficult for these companies to establish a foothold in that market. This is especially severe for American agricultural products, as they have recently faced an additional 10% to 15% tariff from China in response to Trump’s previous tax measures against China. With an additional 34% tariff, the prices of these products will become excessively high, leading buyers to lose interest. Beijing seems unfazed by the search for alternative sources for chicken, pork, and sorghum; China clearly understands that this action is aimed at impacting President Trump's voter base. However, from a global perspective, this raises concerns among analysts. With global supply chains being highly internationalized, products imported from any country may contain components from various places, thus when economic turmoil spreads from one country to others, it could lead to catastrophic consequences for overall trade.

The implementation of Trump's tariff measures has caused volatility in the U.S. stock market, prompting China to announce a 10% to 15% tariff increase on American agricultural products. Trump hopes for a meeting with Xi Jinping, placing high expectations on the key issues regarding the U.S.-China "agreement" at the negotiating table. Meanwhile, with the uncertainty brought by Trump's rhetoric, Xi Jinping sees an opportunity.

American agricultural products hoping to export to China will face the greatest hit. The primary concern is that the two largest economies in the world are confronting each other without any signs of backing down. It's also crucial to observe the timing of the countermeasures announced by China. The Chinese Ministry of Finance announced its resolute countermeasures on Friday at 6 PM (GMT 10:00), coinciding with a public holiday. This timing might suggest several points: first, China intends to suppress this news domestically to avoid angering the public; second, to quickly issue a statement after adjusting its strategy; and finally, China has decided to abandon the opportunity to seek a brief window for an agreement before Trump's new tariffs take effect. The authorities seem to have decided to go all in. If this holds true, it would be severe news for the global economy, as it indicates that reaching any solutions between the two superpowers is more challenging than anticipated.

Another aspect worth noting is Xi Jinping's current behavior. In other countries, governments might focus entirely on television news to avert the worst-case scenarios, but China has not done so. Xi Jinping and other Politburo Standing Committee members are out planting trees, emphasizing the necessity to combat deforestation. This behavior demonstrates a calm demeanor in the face of Trump, projecting an atmosphere that, despite Washington’s efforts, we are uninterested in your nonsense in China. In fact, there may still be room for some sort of agreement between the U.S. and China, but the current rhetoric does not seem to be headed in that direction. China might choose a different path, strengthening trade with other countries, including former Western allies, and establishing some new trade channels that exclude the United States. This would further undermine American companies and the American consumers who will soon be affected by Trump's tariffs.

Trump's tariff measures have previously dealt a heavy blow to China, but this time Beijing is prepared for a response. Trump has effectively pressed the nuclear button of the tariff war, imposing a 10% tax on all imported goods, with even higher rates for "serious violator countries" like China. The executive orders signed by Trump impose tariffs on China, Mexico, and Canada, triggering reactions from various parties.