China’s Ministry of Commerce stated on Wednesday that they will not engage in a trade war with the United States, but will be forced to fight against the world’s leading economy if President Donald Trump escalates trade tensions further. “In a trade war, there are no winners” the ministry said in a statement. “China does not want one, but the government will never allow the legitimate rights and interests of the Chinese people to be violated.”
Following the statement by the Chinese government, China increased tariffs on American imports by an additional 50 percent. This further intensifies the trade conflict between the world’s two largest economies.
The latest statement was issued alongside a white paper on the trade relations between the United States and China, which was published by the State Council Information Office, which collaborates with the government on media matters.
The document was released after Trump’s massive tariffs of 104 percent on Chinese goods came into effect, a move that Beijing has called extortion and vowed to fight.
“The United States uses tariffs as an instrument to exert maximum pressure for selfish purposes – this is classic unilateralism, protectionism and economic bullying” added a spokesperson for the ministry.
The escalating trade war with the United States has called on China’s central bank to step in: Insider reports state that the central bank has asked state-owned banks to reduce their purchases of dollars. Three people familiar with the matter told Reuters that the currency authorities have sent out an informal guideline on monetary policy, asking the banks to scale back their dollar purchases. The directive comes after the country’s currency, the yuan, has been under depreciation pressure due to massive US tariffs on Chinese exports and retaliatory measures by Beijing.