(Source: "China Economic Times" 2025-04-14)
Recently, U.S. President Trump announced the imposition of "reciprocal tariffs" on all trading partners. The cumulative tariffs imposed on Chinese goods have now reached 145%. Some countries will suspend the implementation of "reciprocal tariffs" for 90 days, but retain the 10% "minimum baseline tariff." The U.S.'s practice of exerting extreme pressure at the expense of others and itself will severely damage global w88, drag the world economy into a downward trajectory, and may even trigger a global economic recession.
“Reciprocal tariffs” subvert the rules-based global trading system
The so-called "reciprocal tariff" rate levied by the United States is not calculated as "the country's (region's) tariff rate + non-tariff barriers" as claimed by the United States. Instead, it simply takes the U.S.'s w88 deficit in goods with that country (region) and accounts for the country's (region's) goods w88 deficit with the United States. The ratio of export volume is used as the basis for determining the so-called "reciprocal tariff" rate, and the ratio is discounted in half as the additional tariff rate. The calculation method is simple and crude, with confusing logic and lack of reasonable and legitimate basis. It is just an act of w88 protectionism and w88 bullying under the guise of "reciprocal tariff".
The multilateral trading system with the World w88 Organization as its core is the cornerstone of international w88. After long-term and multiple rounds of w88 negotiations, it has not only effectively reduced the overall level of global tariffs and promoted the stable development of global w88, but also promoted free w88 and ensured the development of developing countries. In order to improve the ability and interests of members to participate in global w88, the World w88 Organization requires developed members to implement reciprocal tariffs, that is, the tariff levels levied on imported goods between developed members are equivalent to the tariff rates levied by trading partners, but it does not require developing members and least developed members to implement reciprocal w88.
The so-called "reciprocal tariffs" imposed by the United States violate World w88 Organization rules. First, the calculation of "reciprocal tariff" rates is not based on the actual tariff rates of each country towards the United States. Second, "reciprocal tariffs" widely involve more than 180 countries and regions around the world, and developing countries and "least developed countries" designated by the United Nations are not immune. Third, imposing differentiated tariffs on different trading partners violates the principle of non-discriminatory treatment among World w88 Organization members. The fourth is to adjust the tariff rate beyond the upper limit agreed upon with other members, which violates the purpose of the World w88 Organization to seek to reduce the overall level of tariffs and constitutes a violation.
The "reciprocal tariffs" introduced by the United States have overturned the multilateral w88 rules system established by all countries in the world after long-term efforts since the Second World War, causing the results of multilateral w88 negotiations to be blatantly trampled, and casting a heavy shadow on the development of global w88.
“Reciprocal tariffs” increase uncertainty in global w88
The multilateral trading system with the World w88 Organization as its core has played an irreplaceable role in correcting world market failures and injecting certainty into global w88. The introduction of so-called "reciprocal tariffs" by the United States will exacerbate the failure of the world market and increase uncertainty in global w88.
For a long time, the world market has been formed in the process of economic globalization. In the development of economic globalization and the world market, on the one hand, countries have built global supply chains, value chains, and industrial chains, promoting the progress of global w88 and world productivity, benefiting all countries in the world; on the other hand, the world market mechanism still has flaws. The multilateral economic system established since the Second World War, including the World w88 Organization, plays an important role in managing global w88 and world economy, improving world market functions, correcting world market failures, solving world market monopoly problems, increasing the supply of public goods, alleviating externality problems, improving the efficiency of resource allocation in relevant countries, promoting economic openness and development in backward countries, narrowing the development gap between countries, enhancing international fairness, and achieving long-term stable growth of the world economy.
There are still flaws in today's world economic governance system and multilateral trading system. Countries should work together to improve the world economic governance system, promote the reform of the World w88 Organization, and improve the multilateral trading system, rather than overthrowing or abandoning the multilateral trading system. The introduction of so-called "reciprocal tariffs" by the United States subverts the rules-based multilateral trading system and ignores the balance of interests achieved in multilateral w88 negotiations over the years. It also ignores the fact that the United States has gained substantial benefits from international w88 in the long term. This has led to increased uncertainty in global w88 and will intensify the risk of global w88 shocks and recession.
“Reciprocal tariffs” make international w88 fall into a negative sum game
International w88 and international market competition are originally a positive-sum game. Countries can obtain comparative benefits, competitive benefits, and absolute benefits while participating in international w88, achieving mutual benefit and win-win results. However, the United States implements so-called "reciprocal tariffs" and launches a global w88 war, pushing international w88 into a negative-sum game. Tariff wars and w88 wars harm everyone but not themselves.
Looking back at the many tariff wars and w88 wars initiated by the United States since the 20th century, they have plunged international w88 into a negative-sum game, severely impacted global w88 and the world economy, and damaged the well-being of people around the world. The United States has also been unable to protect itself, and the American people have also become victims. In June 1930, the United States blamed international w88 for the great crisis that broke out in 1929, launched a w88 war, and implemented the infamous Smoot-Hawley Tariff Act, which significantly increased tariffs on imported goods, prompting many countries to adopt retaliatory tariff measures, causing global w88 to shrink by about two-thirds. The United States itself also suffered heavy losses, exacerbating the Great Depression from 1929 to 1933. In order to avoid a recurrence of the disaster of a major crisis and establish a system of rules to manage global economic and w88 activities, the Bretton Woods system came into being. The multilateral w88 rules determined by the General Agreement on Tariffs and w88 (developed into the World w88 Organization in 1995) have played a huge role in restricting the abuse of w88 protectionism and maintaining international economic and w88 order. Despite this, international w88 frictions and conflicts that violate multilateral rules still occur from time to time. In the 1970s and 1980s, the United States launched a w88 war against Japan. The United States failed to truly improve the international competitiveness of textile, steel, automobile and other industries from the w88 war. On the contrary, American companies took the opportunity to increase domestic sales prices in an environment of weakened external competitive pressure, and consumers had to pay high costs for the w88 war. At the end of the last century, the banana w88 friction between the United States and Europe triggered a w88 war, which spread to the financial sector. The w88 war finally came to an end with the intervention of the World w88 Organization. The w88 war between the United States and Europe has caused losses to both sides. Not only has w88 between the two sides been frustrated, it has even dragged down world economic growth.
“Reciprocal tariffs” harm the fundamental interests of the United States
At the end of the 19th century, the United States became the most economically advanced industrial country in the world and entered the period of monopoly capitalism. Monopoly has led to fewer and fewer high-yield investment venues in the United States, leaving more and more idle excess capital. As a result, the government took up the function of serving monopoly capital. After nearly half a century of fighting, the U.S. dollar finally defeated the pound and became the world currency, creating the most favorable conditions for financial oligarchs and monopoly capital to open up the global market.
The U.S. dollar faces the Triffin Dilemma as a world currency, which requires the United States to maintain both a w88 deficit and a surplus. Therefore, on the one hand, American multinational companies took advantage of the U.S. dollar as the world currency to extend their investment tentacles to all parts of the world, and their manufacturing industries gradually moved overseas. While they made a lot of money from foreign investments, the hollowing out of domestic industries became increasingly obvious, and they had to rely on large amounts of imports to meet domestic demand, resulting in a w88 deficit that gradually expanded. On the other hand, the financial oligarchs in the United States have created a large number of financial products, attracting the return of overseas dollars flowing out of the w88 deficit. The United States has achieved a huge capital account surplus, maintained the overall balance of international payments, and maintained the status of the U.S. dollar as the world currency. However, the United States has also become the country with the largest foreign debt in the world.
With the development of economic globalization, a large number of emerging economies have grown rapidly, and the leading economic position of the United States has weakened. The depreciation of the US dollar has become the general trend. Many countries have abandoned the US dollar, and "de-dollarization" has occurred one after another. The United States raises interest rates to fight inflation and maintain the appreciation of the U.S. dollar, which will increase the domestic debt burden, shrink the balance sheets of companies and residents, and make the government, companies and residents miserable; cutting interest rates will depreciate the U.S. dollar and accelerate the world's abandonment of the U.S. dollar. The United States faces a new dilemma.
It is against this economic background that the United States embarks on the path of anti-globalization and plunders the world by imposing tariffs. The United States hopes that by imposing additional tariffs, it will weaken the product competitiveness of countries with w88 surpluses, relatively improve the competitiveness of American products, reduce w88 deficits, promote the reshoring of manufacturing, increase domestic employment opportunities, and expand capital account surpluses, thereby maintaining the U.S. dollar's world currency status. However, simply imposing tariffs on China, the largest source of w88 deficits, cannot prevent China from taking advantage of the opportunities of globalization to invest in production in other countries and bypass exports to the United States. It cannot change the situation of huge w88 deficits in the United States and curb China's development, so it chose to impose additional tariffs on the world.
Instead of solving its own structural problems and economic development model flaws of low savings, high consumption, and long-term savings significantly lower than investment, the United States has embarked on the path of w88 protectionism and unilateralism and implemented so-called "reciprocal tariffs" in order to increase fiscal revenue, reduce w88 deficits, promote the reshoring of manufacturing, and resolve unsustainable huge debts. It is obviously the wrong "prescription."
While seeking to protect the interests of domestic industrial capital, while severely damaging the global w88 economy, it will eventually backfire on itself, harming the global interests of U.S. industrial capital and financial capital, and damaging the U.S. core economic interests of the U.S. dollar as the world currency.
“Reciprocal tariffs” endanger global w88 development and the stability of the production and supply chain
The U.S.'s imposition of tariffs in the name of "reciprocal tariffs" will inevitably push up the prices of imported goods, exacerbate inflation, severely damage global w88, undermine the stability of global supply chains and industrial chains, drag down the global economy, and even trigger a global w88 and economic recession.
As the United States imposes additional tariffs, the price of imported final consumer goods will rise, which will force consumers to pay higher prices. According to the current rate of additional tariffs, each American family will increase expenditure by about US$3,800, which will inevitably inhibit the expansion of U.S. consumption; the prices of imported intermediate goods and investment goods will rise, and American companies will have to face rising cost pressures, reducing investment desire and ability, inhibiting investment expansion. The contraction of consumption and investment will slow down the U.S. economic growth.
The additional tariffs imposed by the United States will impact the stability of the global supply chain and value chain, not only inhibiting exports from various countries to the United States, but also inhibiting the exports of US-invested enterprises around the world, harming the interests of American multinational companies. It will also lead to counterattacks from various countries, and more U.S. products will be replaced by products from other countries and regions. This will not only hit the interests of U.S. producers in related fields and lead to a decline in manufacturers' performance, but will also impact the U.S. job market and lead to an increase in unemployment in the United States.
“Reciprocal tariffs” impact China’s exports to the United States
As early as Trump’s first presidential term, he launched an investigation into my country based on Section 301 of the w88 Act of 1974, and published four rounds of 301 tariff lists from 2018 to 2019, imposing additional tariffs on 60% of my country’s products exported to the United States. The average tariff rate on my country’s exports to the United States increased from 2.3% to approximately 19.3%. Since the beginning of this year, the United States has imposed an additional 20% tariff on my country's exports, superimposing a 34% "reciprocal tariff", and has since continued to intensify the tariff. The average tariff on my country's exports to the United States has increased significantly, which will seriously inhibit Sino-US bilateral w88, inevitably have a negative impact on my country's exports in the short term, and increase downward pressure on the economy. Although China's exports of goods to the United States account for 14.7% of all goods exports in 2024, it has dropped from 19% in 2017 to 14.7% in 2024. However, among my country's 180 million labor force engaged in export production, more than 26 million people still produce for the US market. Restrictions on my country's exports to the United States will intensify employment pressure.
Of course, even if the United States imposes significant tariffs, China's exports to the United States cannot return to zero. Not only is the United States inseparable from China for many consumer goods, but it also needs to import many investment products and intermediate goods from China. By the end of 2024, 254 products in the United States will be 100% imported from China and cannot find substitutes internationally; more than 80% of 1,006 products must be imported from China; and 1,607 products will have 50% to 80% imported from China. Sufficient substitutes cannot be found internationally in the short term, and a large amount of products will still need to be imported from China. Moreover, as the United States imposes additional tariffs on the world, it has less room for maneuver in finding substitutes outside of China. There is greater bargaining room for Chinese exports, and the additional tariffs will ultimately have to be paid mainly by American consumers.
In recent years, my country's market diversification strategy has been very effective and has become a major trading partner of more than 150 countries and regions. ASEAN has become my country's largest trading partner. my country's export share to ASEAN has increased to 16.4%. The proportion of exports to countries jointly building the "Belt and Road" has increased to 47.8%, and has maintained a rapid growth momentum. There is huge room for economic and w88 cooperation with emerging market countries. China's economy has strong resilience. The US's tariff increases cannot shake China's status as the largest exporter of goods.
China has resolutely countered the tariffs imposed by the United States and Canada, defended its legitimate rights and interests, raised the banner of curbing w88 protectionism and the countercurrent of globalization, and continues to insist on expanding unilateral independent opening up, optimizing the business environment, and is committed to doing its own thing well, safeguarding multilateralism and an open world economy, allowing the world to share open market opportunities, and injecting certainty into the world economy and w88.
(The author is Dean and Professor of the Institute of International Economics, w88 casino)
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