Earlier at a Hari Raya event, I was asked by friend from media: is the G20 summit a game point of the China-U.S. trade dispute, or the match point of it? I replied with a smile, "Let's wait and see."
Last week, Chinese President Xi Jinping met with U.S. President Donald Trump during the G20 Summit in Osaka. The two leaders agreed to promote the China-U.S. relations based on coordination, cooperation and stability, and to resume trade talks on the basis of equality and mutual respect.
President Trump also promised that the U.S. would not impose new tariffs on Chinese imports, and that the U.S. is willing to cooperate with China to properly settle the trade balance problem between the two countries through consultations, and provide fair treatments for enterprises from both countries.
Long sighs of relief could be heard from all the people who have been paying close attention to the China-U.S. trade disputes, as this piece of news may be a ray of hope.
On 22 March last year, President Trump signed an executive memorandum to impose large scale tariffs on imports from China and restricted China companies from investing in the U.S., based on the result of Section 301 investigation. This was the first shot of China-U.S. trade disputes.
In the September of the same year, during the Mid-Autumn festivals, the U.S. again abruptly announced plans to impose 10% tariffs on 200 billion USD of Chinese goods. China fought back swiftly, announcing 5% or 10% tariff on 60 billion USD of U.S. imports.
Later on, with the U.S. side raising the stakes repeatedly, we have seen our fair share of fights and talks, highs and lows. The world has also watched a great drama of constant face-changing and backtracking by the U.S. Side.
Prime Minister Tun Dr. Mahathir has rightly compared the China-U.S. trade war to the scenario where "two elephants fight, and the grass gets stomped". China and the U.S., as the two largest economies in the global economy, will only thrive together in cooperation, or wither together in confrontation, with the world economy following the suit.
Due to the uncertainty of the prospect of China-U.S. trade disputes, the WTO has lowered its forecast for global trade growth in 2019 from 3.7 percent to 2.6 percent. Over the past two years, with the dark cloud of "trade war" looming over the world, many countries are worried that the global economy would be dragged into the "recession trap".
China was pulled into the trade war, with its back to the wall. For China, this is a war to combat economic bullying, a war to safeguard our legitimate right of development, and a war to safeguard the international rules and the multilateral trade system. Last month, the State Council Information Office of the People's Republic of China issued a white paper entitled China's Position on the China-U.S. Economic and Trade Consultations, which comprehensively elaborated on China's position on the trade disputes, so I would not go into details here. Instead, I wish to point out four basic facts.
Firstly, the ultimate motive of the U.S. starting the trade war towards China is to bully the latter under the name of "fair trade". The U.S., wielding its "club of tariff" and carrying the banner of unilateralism and protectionism, blatantly pursues the policy of "America First" and tries to coerce China into giving up its own interests and development rights.
Secondly, the U.S. decisions are counterproductive, and it is getting a taste of its own medicine. Due to the trade war, the domestic production costs and prices have raised significantly, and the economic growth of the U.S. has been hindered and the exports from the U.S. to China has scaled down.
According to the latest statistics on the Forbes website, oil exports from the U.S. fell by 2.49 billion USD compared with the first four months of 2018, among which the exports to China fell from 11% to 2.6%. The LPG exports from the U.S. to China fell by 87%, decreasing 640 million USD. Cotton exports from the U.S. to China fell by 48.33%, decreasing 289 million USD. Soybean exports to China fell by 27.49%, decreasing 710 million USD. The objections against the trade war inside the U.S. have been making waves, and are only getting louder.
Thirdly, the U.S. has underestimated China's determination and capacity to safeguard its core interests and to counter economic bullying. As the world's second largest economy, China has a huge and irreplaceable domestic market that no country could bear to lose. China has its complete industry chain, advanced infrastructures and business-friendly environments. Consumption has become the main driver of China's economic growth for five consecutive years, with a contribution rate of 76.2% to China's economic growth in 2018, while the contribution rate of exports has been decreasing. As a matter of fact, instead of a total collapse as predicted by the U.S., the Chinese economy has maintained a good momentum of sustained and steady development.
Lastly, it is only right to defend the multilateral trading system and to build an open world economy. Malaysia is a pro-trade country with a highly globalized economy, with exports and imports of goods and services equivalent to about 130% of GDP in 2018. A fair, open and transparent international trade system is crucial to each country's development and prosperity, including Malaysia.
In short term, Asian countries like Malaysia may become the beneficiaries of production relocation or import substitute caused by the trade war. However in the long run, all Asian economies work as a part of the global value chain. Any break in the chain will cause systematic damage to all of us. It is an unrealistic idea to look at the China-U.S. trade war with opportunism or a fluke mind, hoping that any of us could survive or even profit from it.
As President Xi Jinping emphasized many times, "China will do well only when the world does well, and vice versa." This is precisely why China proposed the Belt and Road Initiative and commits itself to the multilateralism.
The five-thousand-year Chinese civilization has always advocated the idea of "harmony among differences" and "seeking common ground while reserving differences". We have never regarded the development of other countries as threats to ourselves, and never harmed others' interests for our own benefits, letting alone threating others with maximum pressure, quitting from responsibilities or decoupling.
The Chinese side, with all our sincerity and goodwill, is willing to reach a mutually beneficial solution with the U.S. side through dialogues and discussions based on mutual respect, equality and integrity, and thus bestowing the global market with confidence and vitality. We are willing to cooperate with, not to fight with, the U.S. to make positive contributions to the world economy and global governance, making China and the U.S. greater and the world better.
But wherever the chip falls, China will keep true to its own path. China will remain committed to the reform and opening up policy, and maintain a sound momentum of economic growth. China will foster a more positive dynamic with the world, and continue to function as an engine for the global development.
Finally, I want to tell that friend from media that, the China-U.S. trade dispute is not a fair game with rules and referees, but a trade conflict that the U.S. unilaterally provoked and China was forced to fight back. The consensus reached during the meeting between President Xi Jinping and U.S. president Donald Trump at the G20 Summit is encouraging. We look forward to the U.S. side living up to its words, to work with the Chinese side and to find a solution acceptable to both sides through friendly dialogue. For China, the U.S. and the world, an eventual solution to the trade dispute would definitely worth the wait.
(Chinese and English version of the white paper on the "China's Position on the China-US Economic and Trade Consultations" link:
http://language.chinadaily.com.cn/a/201906/03/WS5cf47231a3104842260bf165.html)