Trump tariffs leads China to declare readiness for ‘economic shocks’

China announced that it is prepared for any unforeseen economic shocks as Trump’s tariff threats persist. Premier Li told business leaders that China would choose the “correct path” of globalization and multilateralism despite rising uncertainty and instability.

China said it is ready for any “unexpected shocks,” ahead of US President Donald Trump imposing higher tariffs on the rival superpower and world’s second-biggest economy. China also claimed that it is ready for “any type of war” with the US following Trump’s tariffs. “If war is what the US wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” asserted China.

According to the Center for Economic and Business Research (CEBR) at Western Washington University, Trump’s tariffs have unleashed a new “China shock,” devastating jobs in emerging economies from Mexico to Indonesia as Chinese exports flood their markets. The situation is set to get worse, with Trump threatening to raise levies on China even higher.

China braces for economic challenges in anticipation of Trump tariffs

Premier Li Qiang, who is responsible for the Chinese economy under leader Xi Jinping, told foreign business leaders gathered in Beijing on March 23 that China is prepared for possible unexpected shocks as the US prepares to impose additional levies on imports from China on April 2. He added that uncertainty and instability are rising despite China’s decision to choose the “correct path” of multilateralism and globalization. 

The warning message from the Chinese premier comes as Beijing tries to improve consumer and investor sentiment while also preparing potential retaliatory measures against future US tariffs and sanctions. Countries and companies are also bracing for the impact of reciprocal tariffs amid expectations that Trump is not inclined to give waivers before the deadline. 

“We have preparations for possible unexpected shocks, which, of course, mainly come from external sources.”

–Premier Li Qiang

Trump has already imposed 20% tariffs on goods from China, in a move the White House said was designed to pressure Beijing to crack down harder on companies that make the ingredients for fentanyl, a deadly synthetic opioid that has triggered an epidemic of drug use in the United States.

In response, China introduced retaliatory tariffs on about $22bn of US goods, including agricultural exports, targeting President Trump’s rural base.

Daines uses meeting with He to reiterate Trump’s tariff demands on China 

Montana’s Republican senator Steve Daines, a very close Trump ally who previously worked in China on business, met Vice Premier He Lifeng on March 22 in a rare meeting between a senior American lawmaker and a top Chinese official. Daines’ office said he used his meeting with He to reiterate Trump’s call for China to halt the flow of chemicals used to make fentanyl. It added that the senator had “expressed hope that further high-level talks between the United States and China will take place in the near future.”

However, there have been very few top-level talks between the US and China since Trump took office. Economic analysts in Beijing also pointed out that ministerial-level talks with the US on a trade deal had not yet begun, and it was unlikely that Xi would meet Trump without first agreeing on some elements of a deal. Donald Trump has said China’s President Xi Jinping will soon visit the US, but China has not issued public remarks about a meeting between the two leaders since Trump took office in January. 

Notably, Daines is expected to meet Premier Li later today. Daines is also scheduled to attend the Beijing forum in a rare move that the US politician hopes will lead to a meeting with Xi on behalf of the American president. The Financial Times previously reported that Daines wanted to be designated as a presidential envoy to facilitate a meeting with Xi—which the senator’s office denied.

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