container ship leaves Qingdao Port, Shandong province. [YU FANGPING/FOR CHINA DAILY]
The United States' new tariff push is likely to backfire by accelerating the de-dollarization trend and potentially prompting sell-offs of US Treasuries by major foreign debt holders, leading economists and currency experts said.
"With the abuse of tariff measures, the US is changing itself from a 'maker and defender' of international rules to a 'destroyer and coercer'," Zhao Zhongxiu, president of the University of International Business and Economics in Beijing, said in an exclusive interview with China Daily.
The US' "reciprocal tariffs", which were announced on Wednesday and include a 10 percent "minimum baseline tariff" and higher rates on certain trading partners, are expected to deal a heavy blow to the multilateral trade system and global commercial practices, while leading to greater economic isolation of the US, Zhao said.
All of this will erode US credibility, further dampen the world's confidence in the dollar and push more countries to settle trade in alternative currencies, said Zhao, a professor of international economics.
Furthermore, some trade partners of the US may see reduced dollar income as exports to the US drop, and they may have to sell US Treasuries to obtain the dollar liquidity needed for international payments, Zhao said.
For China, selling US Treasuries could even be considered a possible countermeasure, if necessary, he added.
As of the end of January, foreign holdings of US Treasury securities stood at $8.53 trillion, with Japan and China being the top two holders at $1.08 trillion and $760.8 billion, respectively, according to the US Department of the Treasury.
The Chinese government will continue to take resolute measures to safeguard its sovereignty, security and development interests, according to a statement released by Xinhua News Agency on Saturday on China's position on opposing US abuse of tariffs.
"We don't make trouble, but we have no fear of trouble," the statement said, adding that the US tariff push is sacrificing the legitimate interests of countries worldwide to serve the US' own hegemonic agenda.
As severe turbulence is set to unfold in global trade, the UIBE president said that China's commitment to fostering a more open, stable market environment and creating more opportunities for mutual benefit will be crucial in avoiding a drastic global economic recession.
Following the US tariff announcement, Stephane Dujarric, spokesman for the secretary-general of the United Nations, expressed concern over the "rise in economic protectionism" and its impact on the global economy.
Guan Tao, global chief economist at investment bank BOCI China, told China Daily that the "reciprocal tariffs" may increase the risk of a deep global recession, drawing parallels to the 1930 Smoot-Hawley Tariff Act, which triggered retaliatory measures, collapsed global trade and deepened the Great Depression.
The recession fears have affected the greenback, as anticipation of US interest rate cuts to counter slower growth weakened the US dollar index, which gauges the greenback's value relative to a basket of currencies, to 102.85 as of Friday's close, down 5.13 percent since the beginning of the year, according to market tracker Wind Info.
In the long run, the US' "reciprocal tariffs" are bound to undermine its own currency's global role, said Guan, who is also former head of the Balance of Payments Department at the State Administration of Foreign Exchange.
"To supply global dollar liquidity, the US must run trade deficits. As Washington seeks to reduce deficits through tariffs, global dollar liquidity will tighten, weakening the dollar's international standing," Guan said.
Jeffrey Sachs, director of the Center for Sustainable Development at Columbia University, called for Washington to aim for a world in which prosperity is widely shared, rather than one in which only the US thrives while others remain poor.
Chen Wenling, former chief economist at the China Center for International Economic Exchanges, said that China's vast economic scale will serve as a strong buffer against external pressures, especially as the country prioritizes domestic demand to build a more stable growth model that is less exposed to global trade volatility.
中新经纬1月11日电 “上海市场监管”微信号11日消息，宜家召回3008件USB充电器。 上海市市场监管局称，宜家(中国)投资有限公司自2024年1月10日至2024年4月9日召回2020年4月至2023年12月生产的宜家牌ASKSTORM 奥斯 “首都南大门”保定，中创燕园在这里新扩建的厂房已完成装修，北京大学物理学院的专家每周都前来开展研发工作，这是“北京研发，保定落地”的一个缩影；海河之滨，依托京津物流园在京津两地间搭建高端智 “竞争”正日益成为华盛顿对华政策的高频热词。1月30日，美国总统国家安全事务助理沙利文在一次智库活动中，一方面坦承美国“几十年来为塑造或改变中国所作出的努力都没有取得成功”，另一方面呼 新华社记者付敏、姚雨璘在寸土寸金的厦门岛市区，面积约3公顷的骑马山片区保护区隐匿在林立的高楼大厦中。该保护区设置于2011年，是厦门五缘湾栗喉蜂虎市级自然保护区的重要组成部分——一种 龙年开工首周，记者在多地采访看到，企业加快开工复产、劳动者积极返岗求职，呈现出人勤春来早、供需同发力的繁忙景象。“用工忙”折射开局稳，释放出经济运行回稳向好的信心。从跨省招工、专车专列接人返岗 拼版照片：上图为20世纪80年代的厦门筼筜湖（资料照片）；下图为2024年1月24日拍摄的厦门筼筜湖及周边城市景观（新华社记者姜克红摄，无人机照片）。新华社记者付敏城在海上，海在城中。筼筜湖，犹如镶嵌在厦门岛中央 。本文链接：Abuse of tariff measures likely to backfirehttp://www.sushuapos.com/show-5-52779-0.html
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