MNI POLICY: China To Take "Necessary Retaliatory Measures"

By Iris Ouyang

     BEIJING (MNI) - Beijing will have to take "necessary retaliatory measures"

if the U.S. announces any further tariff impositions, China's Ministry of

Commerce stated on Thursday.

     Any U.S. tariff action against China is "unreasonable and useless,"

ministry spokesman Gao Feng told a weekly press briefing. The trade conflict

would be best tackled through "sincere and fair" negotiations, he stressed.

     Gao's comments come on the same day as the U.S. concludes a public comment

period on the Trump administration's proposed imposition of tariffs on $200bn of

Chinese goods, including many products used by U.S. households on a daily basis.

If Washington goes ahead with these levies, Beijing has vowed to retaliate with

tariffs on a further $60bn of U.S. goods.

     Gao added that Chinese and U.S. officials are maintaining communications on

trade, but did not provide any details.

     He emphasised that China has the "confidence, ability and solutions"

necessary to maintain stable economic growth. Beijing will closely monitor the

impacts of mutual tariff actions on companies, and help both Chinese and foreign

firms based in the country to overcome difficulties, Gao said.

     Developments this week suggest that the world's second largest economy is

improving relations with other trading partners, including Africa and the EU. At

the China-Africa Forum, held in Beijing on Monday and Tuesday, Chinese President

Xi Jinping announced another $60bn of aid and loans to African countries.

Meanwhile, China's free trade agreement with Mauritius - its first with an

African country - was confirmed over the weekend.

     Gao told reporters the free trade zone will include investment and economic

cooperation, and will facilitate mutual tourism.

     Beijing is planning free trade negotiations with other African countries,

Gao said.

     The narrowing of China's trade surplus in July mainly reflected a "constant

and significant increase of imports," on the back of stable economic growth and

tariff reduction measures, Gao said, adding that China never purposely seeks to

engineer a trade surplus.

     "China will improve the convenience of trade and further open its market to

facilitate the balanced growth of trade," he added.

     Earlier this week, the EU ended its five-year restriction on solar panel

imports from China. Gao pointed to this as a solid sign of the EU's support of

free trade, and a move which will help to restore the China-EU solar panel

businesses to normal market status.

     "China is willing to work with the EU to defend free trade and the

rules-based multilateral trade system," Gao said.

--MNI Beijing Bureau; +86 (10) 8532-5998; email: iris.ouyang@marketnews.com

--MNI London Bureau; +44 207-862-7489; email: ukeditorial@marketnews.com

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