Given its humongous trade surplus with the U.S., it would be only natural to assume that China has much to lose in the event of a hike in U.S. import tariffs. Before such tariffs are enforced by Washington, Beijing is boosting up its exports to the U.S. while prolonging negotiations; the ensuing delay in tariff hikes by the U.S. appear to be working well for Beijing.
According to U.S. customs data, the United States’ trade gap with China has widened to $24.58 billion in May 2018, up from $22.15 billion a month earlier.
The development comes as the two are locked in a tense trade stand-off.
For the period of January to May, China’s trade surplus with the United States stood at $104.85 billion.
U.S. President Donald Trump has pushed China to open up its economy further, remove its coercive trade strategies towards intellectual property rights and reduce its trade surplus with the United States.
The Chinese threat of tit-for-tat tariffs is largely a bluff since it clearly has hundreds of billions to lose in the event of a trade war, which will significantly curtail its military spending.
In May the White House has warned that it would pursue tariffs worth $50 billion of Chinese imports as well as tighten export control norms and clamp down on Chinese investments in the country.
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