Faced with tariffs that could spark a new trade war in Trump’s second term, countries like Canada and China could benefit from lessons from the last trade war.
Container ship at Qingdao port, Shandong province, eastern China on March 4 - Photo: AFP
Many strategies
"If war is what the US wants, whether it is a tariff war or any other kind of war, we are ready to fight to the end," the Chinese Embassy in the US posted on X on the evening of March 4 (US time), emphasizing Beijing's readiness to confront.
Canadian Prime Minister Justin Trudeau admitted at a press conference on March 4 that the 25% US tariff would damage the Canadian economy, but Mr. Trump would also have to realize that increasing tariffs would have a negative impact on both sides.
According to US government figures, 17% of US exports go to Canada, while more than 75% of Canadian exports go to the US.
Canada was previously involved in a “tariff war” with the US during Mr Trump’s first term, when Mr Trump imposed a 10% tariff on Canadian aluminum and a 25% tariff on steel.
Ottawa retaliated by imposing tariffs on a number of US imports, including orange juice, whiskey and bourbon. Both sides eventually agreed to lift the tariffs just a year later.
Targeted tariffs are often the safest and first approach, said Peter Clark, a lawyer who worked on trade policy at the Canadian Ministry of Finance. By targeting specific products, Canada can retaliate against the U.S. without causing too much impact on Canadians.
On March 4, China announced an import tax of 10-15% on some agricultural and food products from the US, including chicken, wheat, corn, and soybeans.
Alfredo Montufar-Helu, a China expert at the Conference Board, said Beijing's retaliatory tariffs were "a restrained, targeted approach aimed at harming industries that are important to Trump supporters."
During Mr Trump’s first term, Beijing cut its dependence on US agricultural goods by boosting domestic production and buying more from countries like Brazil.
The previous US-China trade war opened up a "China +1" strategy, when businesses choose another country to expand production to avoid having their goods taxed when entering the US.
Cambodia is a prime example of how the trade war has led to a boom in Chinese investment in the country. The Cambodian government says more than half of the factories in the country are now Chinese-owned, with a total investment of about $9 billion.
The trade war is long
Prime Minister Trudeau said the Canadian government is in talks with the provinces to pursue a number of non-tariff measures if tariffs on Canadian goods do not end.
Ontario Premier Doug Ford also threatened to cut off energy supplies to the United States in response to the tariffs. "If they want to try to destroy Ontario, I will do everything, including cutting off their energy with a smile on my face," Ford told reporters.
As for Mexico, President Claudia Sheinbaum said the country will announce a list of U.S. goods that will be subject to retaliatory tariffs on March 9. Sheinbaum’s delay suggests Mexico is hoping to de-escalate its trade war with the U.S. Sheinbaum also said she plans to talk to Trump this week.
China keeps 5% growth target
The third session of the 14th National People's Congress of China opened in Beijing on March 5. At the opening session, Premier Li Qiang presented a report in which China set an economic growth target of around 5% in 2025, the same as in 2024. Experts consider this an ambitious target.
Mr. Li warned that the “increasingly complex external environment” could have a major impact on China in the fields of trade, science and technology, and that “changes unseen in a century are taking place at a faster pace8.
By 2025, China aims to bring inflation down to 2%, create more than 12 million new urban jobs, and reduce the deficit to GDP ratio to around 4%. Beijing has pledged to turn domestic demand into the main economic driver as the trade war with the US weighs on exports.
Premier Li Qiang also said China would resolutely oppose separatist activities aimed at Taiwan independence to promote peaceful cross-strait relations. Beijing announced it would maintain defense spending at 7.2 percent in 2025.
Source: https://tuoitre.vn/how-canada-trung-quoc-mexico-ung-pho-cuoc-chien-thuong-mai-ra-sao-20250306082422525.htm
Comment (0)