Beijing Issues Strong Warning Over US-Led Trade Agreements

China Warns Against Trade Deals That Undermine Its Interests

Beijing has cautioned countries against entering trade agreements with the United States that may harm China’s economic interests. This move comes amid rising global trade tensions, with the world’s two largest economies—China and the United States—locked in a growing tariff standoff.

In a statement released on Monday, China’s Ministry of Commerce said it "firmly opposes any party reaching a deal at the expense of China’s interests", and warned that such actions would lead to reciprocal countermeasures.

US Trade Strategy: Isolating China?

The warning follows reports that the administration of US President Donald Trump is attempting to isolate Chinese businesses by negotiating trade deals with over 70 countries. These deals may include incentives such as reduced US tariffs, provided that partners align with Washington’s efforts to marginalise Beijing economically.

According to The Wall Street Journal, this strategy aims to pressure China into negotiations by limiting its global trade options. However, Beijing has shown no sign of altering its position under pressure.

China Responds with Tariffs and Diplomacy

China, which remains a primary target of the Trump administration's tariff policies, has retaliated by imposing its own steep tariffs on US goods. While the US has reduced tariffs on most other nations, levies on Chinese products remain as high as 145%.

In response, China has placed tariffs of up to 125% on American goods and continues to reject any trade deals perceived as unfair. Despite calls from Trump for open negotiations, there has been no indication of active high-level dialogue between the two nations.

Xi Jinping Strengthens Regional Alliances

Last week, Chinese President Xi Jinping visited Vietnam, Malaysia, and Cambodia in a diplomatic push to reinforce trade relationships within the region. These visits are part of China’s broader effort to solidify economic ties with Southeast Asian nations, many of which are under scrutiny by the US for allegedly helping China bypass trade restrictions through transshipment.

A Fragile Economy Under Pressure

China is facing growing economic challenges, including weak domestic demand and a slowing property market. To sustain growth, policymakers are leaning heavily on manufacturing and exports. While the government has announced initiatives to boost consumption, it has refrained from introducing large-scale fiscal stimulus packages—choosing instead to invest in strategic industries and reduce dependency on Western technology.

China Calls for Fairness and Multilateral Cooperation

In its statement, China’s Ministry of Commerce emphasised the importance of fairness and multilateralism in global trade. “China respects the right of all parties to resolve their economic and trade differences with the United States through equal consultations,” the ministry said. However, it reaffirmed its commitment to defending its own economic rights if challenged.

The ministry urged all countries to uphold international trade rules and warned against returning to a system where "the strong prey on the weak", asserting that such a scenario would harm all nations.

Conclusion: Rising Tensions with No Clear Resolution

As trade tensions escalate, China has taken a firm stance against any effort to undermine its global economic position. The ongoing tariff battle with the United States shows no signs of abating, and the pressure on global partners to choose sides only adds to the uncertainty. With high tariffs, diplomatic manoeuvring, and economic vulnerabilities at play, the world is closely watching to see how this high-stakes standoff will unfold.

Sources: (FT.com, BBC.co.uk)