"Wait and see": China still mulling retaliation in trade war with U.S.
Beijing -- Companies were bracing Monday for how Beijing might retaliate against President Trump's escalation of a fight over technology and trade that threatens to disrupt a Chinese economic recovery.
China has threatened "necessary countermeasures" for Mr. Trump's tariff hikes Friday on $200 billion of Chinese imports. But three days later, in a break with previous tit-for-tat penalties that were imposed immediately, Beijing had yet to announce what it might do.
A foreign ministry spokesman said Monday he had no details about Chinese plans or high-level contacts since negotiations ended Friday without a deal.
"We are determined and capable of safeguarding our legitimate rights and interests," the spokesman, Geng Shuang, told a daily news briefing. "We hope the United States will meet China halfway to address each other's legitimate concerns."
China "will never surrender to external pressure," Shuang said, according to the Reuters news agency.
According to Reuters, he said, "As for the details, please continue to pay attention. Copying a U.S. expression – 'wait and see."'
Asian stock markets fell sharply Monday, European shares also declined and U.S. stock futures suggested a significantly lower opening in New York.
China is running out of U.S. imports it could penalize due to the lopsided U.S.-Chinese trade balance. Regulators have been targeting American companies in China by slowing down customs clearance for shipments and processing of business licenses.
Officials appeared to be studying the potential impact on China's economy before picking their next steps, said Jake Parker, vice president of the U.S.-China Business Council, an industry group. He said officials might be worried companies may shift operations out of China in response to "aggressive retaliatory actions."
"I assume this goes fairly high within China's government before retaliatory actions are settled upon," said Parker.
On Sunday, National Economic Council director Larry Kudlow contradicted recent statements by Mr. Trump, conceding that a recent increase in tariffs on Chinese goods will not only hurt China, but American companies and consumers as well.
"Both sides will pay," Kudlow, the president's top economic adviser, said on "Fox News Sunday," referring to the escalating trade dispute between the U.S. and China — the world's largest economies.
Pressed about comments in which Mr. Trump has alleged Beijing will end up paying for the increased levies, Kudlow responded that "both sides will suffer on this."
Still, he argued that China's Gross Domestic Product will ultimately suffer more from the recent 15 percent tariff hike — which went into effect Friday — because of a "diminishing export market."
On Monday morning, the president persisted with his assertions, tweeting, "Their is no reason for the U.S. Consumer to pay the Tariffs, which take effect on China today."
Forecasters warned that Friday's hikes could disrupt a Chinese recovery that appeared to be gaining traction. Growth in the world's second-largest economy held steady at 6.4 percent over a year earlier in the latest quarter, supported by higher government spending and bank lending.
Mr. Trump started raising tariffs last July over complaints China steals or pressures companies to hand over technology.