China has the ability to pay a price against the US trade war

There are no winners in the trade war, so in the largest trade war between China and the United States in human economic history, both sides inevitably have to pay the price and bear the loss. In this regard, China has already made an estimate and prepared a plan to deal with it.

On the evening of the 9th, a spokesman for China’s Ministry of Commerce announced four measures to alleviate the impact of Sino-US trade frictions, including: continuously evaluating the impact on various enterprises; The increase in tax revenue from counter-measures is mainly used to mitigate the impact on enterprises and their employees; to encourage enterprises to adjust their import structure; and to accelerate the implementation of the State Council’s views on actively and effectively utilizing foreign capital and promoting high-quality economic development. We will strengthen the protection of the legitimate rights and interests of enterprises and create a better investment environment. Obviously, in order to reduce the losses of the trade war, the Chinese government is playing a combination of both symptoms and causes, which embodies the strong ability of risk control, the determination and endurance of fighting the trade war, and the ruling concept of “taking the people as the basis”.

As some analysts have pointed out, the US tariff on $34 billion of Chinese imports will have an impact on some of China’s businesses and will have an impact on the family life of its employees and ordinary people. The Chinese Government has long been aware of these consequences, so it has always made it clear that it does not want to fight. However, this trade war, the Chinese government has to fight, have to accompany to the end. Because people of insight have long seen that the United States has been engaged in a trade war for a long time, not just to achieve the so-called trade balance. The core is to crack down on China’s ability to innovate in high technology and fundamentally curb China’s development. It even wants to force the Chinese economy to carry out “structural reforms” and change China’s development path.

Therefore, the fight against the United States trade war, for China, is related to the core interests of the country, the future interests of the nation and the interests of the people. To this end, China has to pay a certain controllable cost, to bear a certain marginal loss.

Of course, any loss of interest to China as a whole is partial and small, and may have a greater impact on individual or individual enterprises. Based on the concept of people-oriented governance, the Chinese government is bound to try its best to keep the adverse effects to a minimum. The first two measures announced by the Ministry of Commerce are a direct and effective response for damaged companies and employees that can alleviate their immediate needs. The third measure is designed to encourage firms to import more from other countries and regions, which is a suggestion from the long-term development of the enterprise, where diversification of trading partners would otherwise help to spread the risk. The fourth proposal is to improve the quality of economic development and effectively protect the soft environment of enterprise development to hedge against the negative impact of the Sino-US trade war and enhance the cohesion of the Chinese market. It has been noted that the China Securities Regulatory Commission (CSRC) announced on the 8th that it would further liberalize the opening of A-share accounts by foreigners, which is an orderly move by China to open its capital markets in accordance with established directions and plans. A high-quality developing capital market is naturally a strong support for the fight against the US trade war.

As the Sino-US trade war has just begun and there are many uncertainties in the future, the impact caused by it is changing dynamically, and China’s response plan must be adjusted at any time. In response, China’s Ministry of Commerce said it would continue to improve the policy mix, and welcome more suggestions from all sectors of the community. It can be expected that as the Sino-US trade war evolves, the Chinese government’s stop-loss program will continue to be adjusted and optimized to minimize losses.

Is China really capable of paying a price in the fight against the US trade war? it is seen that China is the only country in the world with a total industrial category, with a huge consumer market of nearly 1.4 billion people. This means that even in the most difficult times, the Chinese economy can achieve internal circulation. At the same time, 91% of China’s economic growth comes from domestic demand, and 60% of domestic demand is driven by consumption, which is constantly escalating and the market is vibrant. More importantly, the number of Chinese innovation enterprises ranks second in the world, and innovation-driven development has made the Chinese economy more resilient. In addition, China has constantly expanded its opening up in accordance with the established strategy, which has greatly enhanced the confidence of the outside world. According to the 2018 China Business Environment Survey released by the American Chamber of Commerce in China, 74 percent of member companies plan to expand their investment in China this year, the highest percentage in recent years.

Fighting the US trade war is a “national war” for China. China has more than five thousand years of history and culture, and the Chinese people have a heroic sentiment of “worrying before the people’s worries and being happy after the people’s happiness” and the common people’s spirit of “leaving small families to care for everyone.” In the face of this “national war,” the Chinese people know very well that “only a country has a home” and are willing to bear the temporary loss of personal life and share the difficulties with a responsible government. We will safeguard the long-term overall situation of sustained economic development and national rejuvenation. This is China’s strongest strength in fighting the US trade war!

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