China’s New Weapons: How Beijing Could Retaliate in a Trade War
As a new trade war looms, China is showing it has a much broader arsenal than ever before. More than just tariffs, Beijing has a range of tools at its disposal, all aimed at inflicting economic pain and weakening U.S. influence.
The Biden administration’s economic policies are being closely analyzed in Beijing, with China spotting weaknesses for a retaliaiton. Recent threats from a new administration that have introduced the possibility of 60% tariffs on Chinese goods.
Such a drastic measure would devastate trade between the two major economies.
This time around, China is signaling it’s prepared to get tough. Here’s a closer look at some potential weapons in China’s arsenal:
Sell US Treasuries)
The most drastic step China could take
sell its vast holdings of US debt.
China is the second largest holder of Treasury bonds globally, with holdings around
$734 billion.
A sudden unloading
that pressure on US bond yields and disrupt global financial markets
**
Weaken the Yuan**
making Chinese exports more competitive.weaken<a rel="nofollow" Target="_blank"treasures
href="https://www.bloomberg.com/news/articles/2023-07-03/china-to-restrict-exports-of-metals-critical-to-chip-production”>https://www.bloomberg.com/news/articles/2023-07-03/china-to-restrict-exports-of-metals-critical-to-chip-production”>https://www.bloomberg.com/news/articles/2023-07-03/china-to-restrict-exports-of-metals-critical-to-chip-production
A weaker conversation.
Restrict key exports
Crucially, China controls the supply for many critical minerals and materials, but these are vital whale US
.**
restrict
threatening to cut off access to
This
Target US Companies
China is not courting
European investments in the indust, focusing on
Relying on _
, _Bear
_
China could leverage this leverage to the US, leading
to drive a wedge
rescue
, and other investments
in return for
This
.
Strength
.
They are
parceiros. But
The US is on the
should leave
China’s
Yeni酱:
from="_ Consider
blan" href="https://www.bloomberg.com/news/articles/2024-11-12/us-zeroes-in-on-semiconductor
that target
China
However, this would
be formally freezing relations between the two sides. ,
Manuelalisis.cnn.com/data/i/
## China’s New Weapons: How Beijing Could Retaliate in a Trade War
**Host:** Welcome back to the show. Tonight, we’re talking about the looming threat of a new trade war with China. With the prospect of 60% tariffs on Chinese goods, Beijing is signaling it’s ready to fight back, and they have a much wider range of weapons at their disposal than before. Joining us now is Dr. Emily Chen, a leading expert on Chinese economics and trade. Dr. Chen, welcome to the show.
**Dr. Chen:** Thank you for having me.
**Host:** Let’s talk about these new weapons. We’ve heard about tariffs before, but what else is China prepared to do to retaliate against the US?
**Dr. Chen:** That’s right, tariffs are just one part of the arsenal. Beijing is looking at a variety of options, including potentially selling off large portions of its US Treasury Bond holdings. As we know from [1](https://www.nytimes.com/2024/11/11/business/trump-china-trade-war.html), China is heavily invested in US debt, holding around $734 billion in Treasury bonds. A sudden sell-off could significantly impact US bond yields and create major disruptions in global financial markets.
**Host:** That’s a dramatic step. What other tools could China use?
**Dr. Chen:** They could also target American companies operating in China, impose stricter regulations, or even launch investigations into their practices. Additionally, China could limit exports of crucial raw materials or components that are vital to American industries.
**Host:** So, this is a much more complex and potentially damaging situation than previous trade disputes?
**Dr. Chen:** Absolutely. China’s economy has evolved significantly since the last trade war. They are less reliant on American markets and have made strides in self-sufficiency. While tariffs will still have an impact, Beijing is now better positioned to weather the storm and inflict economic pain on the US.
**Host:** Thank you for shedding light on this complex issue, Dr. Chen.
**Dr. Chen:** My pleasure.
