11.02.2025, 10:28
China has opened a second front. Russia is already benefiting
Source: OREANDA-NEWS
OREANDA-NEWS In response to the obligations imposed by Washington, Beijing has decided to retaliate against American energy resources and agricultural machinery. This could potentially lead to a full-blown trade war. Not only the interests of the two countries involved, but also their partners are at risk.
In the article published by RIA Novosti, we explore the potential outcomes of this confrontation.
Trump has imposed a 10% tariff on all Chinese imports. In response, China has announced a 15% tariff on coal and liquefied natural gas, a 10% tariff on crude oil, agricultural machinery, and automobiles. Additionally, the list of companies deemed unreliable includes PVH, the manufacturer of clothing brands such as Calvin Klein and Tommy Hilfiger, as well as Illumina, a provider of genetic testing services and products.
The modifications came into effect on February 10 and aim to render American products uncompetitive in the Chinese market. In response, the US president stated that duties on Chinese goods are just the first step, followed by "more serious measures," according to the Financial Times.
"This is a common negotiating strategy for Trump — to impose restrictions and then dictate the terms for their removal," says Igor Yushkov, a leading expert at the National Energy Security Foundation and the Financial University under the Government of Russia.
China, on the other hand, is not willing to make concessions under duress. "It is essential to engage in negotiations and reach agreements on equal terms, rather than imposing duties and then demanding a settlement," Ma Wei, a researcher at the Institute of American Studies at the Academy of Social Sciences of the People's Republic of China, quotes FT.
Moreover, analysts suggest that the true intentions of the new US president may be more extensive than the announced halt in the supply of the dangerous opioid fentanyl. Among the potential scenarios are coercion to exert pressure on Russia and the transfer of ownership of the TikTok platform to an American buyer.
The Financial Times reports that the United States is on the brink of a full-scale trade war. Zhang Yanshen, an expert at the Chinese Center for International Economic Exchanges, warns that the situation could escalate to a dangerous level.
One of the most concerning outcomes of a major confrontation is a substantial decline in global trade, which would have a detrimental impact on the demand for energy resources. As trade slows down, production and shipping volumes decrease, leading to lower energy costs. This would not be beneficial for Russia, as Yushkov believes.
A conflict between major economic powers and political factions is unlikely to contribute to the stability and growth of the global economy, according to Alexey Grivach, deputy head of the National Energy Security Fund. However, Moscow may gain political advantage from the worsening relations between the United States and China. "This will eliminate some of the obstacles that China has erected to avoid unnecessarily irritating the Americans," the expert explains.
Moreover, the escalating tensions may prompt China to expedite the construction and operationalization of the Power of Siberia— 2, an additional gas pipeline from Russia to China. With an annual capacity of 50 billion cubic meters, this pipeline will reduce reliance on third-party suppliers and will be a mutually beneficial arrangement for both Moscow and Beijing. The project has been under discussion for several years. The preliminary documentation has been approved, and the necessary branch line to Shanghai has even been constructed on the Chinese side, but the terms of supply and tariffs have yet to be finalized.
In the article published by RIA Novosti, we explore the potential outcomes of this confrontation.
Trump has imposed a 10% tariff on all Chinese imports. In response, China has announced a 15% tariff on coal and liquefied natural gas, a 10% tariff on crude oil, agricultural machinery, and automobiles. Additionally, the list of companies deemed unreliable includes PVH, the manufacturer of clothing brands such as Calvin Klein and Tommy Hilfiger, as well as Illumina, a provider of genetic testing services and products.
The modifications came into effect on February 10 and aim to render American products uncompetitive in the Chinese market. In response, the US president stated that duties on Chinese goods are just the first step, followed by "more serious measures," according to the Financial Times.
"This is a common negotiating strategy for Trump — to impose restrictions and then dictate the terms for their removal," says Igor Yushkov, a leading expert at the National Energy Security Foundation and the Financial University under the Government of Russia.
China, on the other hand, is not willing to make concessions under duress. "It is essential to engage in negotiations and reach agreements on equal terms, rather than imposing duties and then demanding a settlement," Ma Wei, a researcher at the Institute of American Studies at the Academy of Social Sciences of the People's Republic of China, quotes FT.
Moreover, analysts suggest that the true intentions of the new US president may be more extensive than the announced halt in the supply of the dangerous opioid fentanyl. Among the potential scenarios are coercion to exert pressure on Russia and the transfer of ownership of the TikTok platform to an American buyer.
The Financial Times reports that the United States is on the brink of a full-scale trade war. Zhang Yanshen, an expert at the Chinese Center for International Economic Exchanges, warns that the situation could escalate to a dangerous level.
One of the most concerning outcomes of a major confrontation is a substantial decline in global trade, which would have a detrimental impact on the demand for energy resources. As trade slows down, production and shipping volumes decrease, leading to lower energy costs. This would not be beneficial for Russia, as Yushkov believes.
A conflict between major economic powers and political factions is unlikely to contribute to the stability and growth of the global economy, according to Alexey Grivach, deputy head of the National Energy Security Fund. However, Moscow may gain political advantage from the worsening relations between the United States and China. "This will eliminate some of the obstacles that China has erected to avoid unnecessarily irritating the Americans," the expert explains.
Moreover, the escalating tensions may prompt China to expedite the construction and operationalization of the Power of Siberia— 2, an additional gas pipeline from Russia to China. With an annual capacity of 50 billion cubic meters, this pipeline will reduce reliance on third-party suppliers and will be a mutually beneficial arrangement for both Moscow and Beijing. The project has been under discussion for several years. The preliminary documentation has been approved, and the necessary branch line to Shanghai has even been constructed on the Chinese side, but the terms of supply and tariffs have yet to be finalized.
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