Trump threatened to launch a trade war if China fails to address the mounting trade deficit problem by opening its markets to US goods and investments.
Chinese e-commerce giant Alibaba Group founder Jack Ma has said that it was normal for the world’s two largest economies to have problems with trade but tackling them with a trade war is just like treating a flu with chemotherapy. In an apparent criticism of US President Donald Trump’s moves to slap tariffs on Chinese goods to pressure Beijing to reduce USD 375 billion trade deficit in the bilateral trade, he said “You are not solving the problem of the cold, you are destroying the whole body, the whole system”.
Trump threatened to launch a trade war if China fails to address the mounting trade deficit problem by opening its markets to US goods and investments. China hit back by announcing tariffs on a host of US goods, including Soya beans and automobiles. Speaking at a dinner with International Monetary Fund Managing Director Christine Lagarde during the Boao Forum for Asia annual conference yesterday, Ma said that trade was about mutual respect and nobody can stop globalisation. “It’s normal for the world’s two biggest economies to have problems with trade, but tackling them with a trade war is just like treating a flu with chemotherapy,” he said.
“Trade is about rules and negotiations. If trade stops, war starts,” the state-run Xinhua news agency quoted him as saying. He dismissed the US-China trade deficit as a problem, citing economic growth and a low jobless rate in the United States as well as huge profit made by the American firms in the bilateral trade. “Today as a businessman, I don’t feel that trade deficit is a problem,” he said. Lagarde also warned of the risk of temptation for inward policies, protectionism and closing off to the outside world.
She suggested reducing trade barriers in the service industry where there is “a big, big upside” in promoting openness. The IMF managing director also cautioned challenges to the global economy, including corporate debt and demographic change, saying that “the sun is shining, but we have to look at the cloud arising.” Globalisation has not been inclusive enough in the past decades, but there are ways to fix it, Ma noted.