BEIJING, Marh 04 (AFP): China warned Sunday that it was ready to hit back if the United States (US) damaged its economic interests, fuelling fears of a trade war after President Donald Trump unveiled tariffs on steel and aluminium.
Trump's announcement on Thursday sparked a flurry of counter-threats from other nations. But Washington's main trade rival had avoided any overt warnings of potential retaliation until now.
"China doesn't want a trade war with the United States," Zhang Yesui, spokesman for the National People's Congress, told a news conference on Sunday, the eve of the rubber-stamp parliament's annual session.
"But if the US takes actions that hurt Chinese interests, China will not sit idly by," Zhang said. An official English-language interpreter added the phrase, "and will take necessary measures".
Zhang warned that "policies informed by misjudgement or wrong perceptions will hurt relations and bring consequences no side wants to see".
Trump's announcement came as President Xi Jinping's top economic aide, Liu He, met US officials at the White House to discuss the fraught economic relationship.
During his visit, according to the official Xinhua news agency, Liu and his hosts "agreed that the two countries should settle their trade disputes by cooperation rather than confrontation".
Since announcing plans to impose a 25 per cent tariff on steel imports and 10 per cent on aluminium, Trump has shrugged off threats from other nations, boasting on Friday that "trade wars are good, and easy to win".
China has been the main target of Trump's anger over the US trade deficit since his presidential campaign, but its steel and aluminium exports to the United States are minimal.
While China is the world's largest steel producer, it accounts for less than one per cent of US imports and sells only 10 per cent of its wrought aluminium abroad.
Steel producers in Canada, Brazil, Mexico, South Korea and Turkey rely far more heavily on the US market.
"The American action to put sanctions on other countries' reasonable steel and aluminium exports in the name of harming national security is groundless," Chinese Foreign Minister Wang Yi said on Saturday.
Some US allies, like Canada and Australia, had hoped to be spared the tariffs. A major South Korean business lobby, the Federation of Korean Industries, said Sunday it sent letters to US Congress members and officials seeking an exemption.
A US official said Friday possible exemptions to the measures would be considered on a case-by-case basis.
Australia warned that a trade conflict could put the brakes on global economic growth.
"That's what concerns me, if we continue to see an escalation of rhetoric and, ultimately, action around tariffs applying for imports and exports across multiple economies... this will lead to a slowdown in growth," trade minister Steve Ciobo told Sky News Australia Sunday.
Trump ratcheted up the rhetoric on Saturday, threatening a tax on cars from the European Union if it takes retaliatory measures.
On Friday European Commission chief Jean-Claude Juncker said the EU was drawing up measures against leading US brands such as Levi's and Harley-Davidson.
Another report from Sydney adds: Australia Sunday warned against tit-for-tat retaliation and the outbreak of a trade war that could slow global economic growth, as it pushed to be excluded from US President Donald Trump's steel and aluminium tariffs.
Canberra has sought to be exempt from the hefty tariffs, citing an understanding reached with the United States (US) at G20 meetings last year.
There are also local industry concerns that the tariffs could see cheap steel destined for the US flood the domestic market instead.
"We've seen... over the last 48 hours commentary from Canada, from the European Union. We've seen the US government going back about tariffs on cars," Trade Minister Steve Ciobo told Sky News Australia Sunday.
"That's what concerns me, if we continue to see an escalation of rhetoric, and, ultimately, action around tariffs applying for imports and exports across multiple economies... this will lead to a slow-down in growth."
Ciobo said he spoke with his US counterpart Wilbur Ross Saturday, but was unable to secure an exemption guarantee, adding that it would "ultimately... come down to a decision of the president".
A US official said Friday no countries will be exempt, but added that possible exemptions to the measures would be considered on a case-by-case basis.
The minister said Canberra would use existing anti-dumping measures if cheap products flood the Australian marketplace as a result of the Trump tariffs.
But he would not comment on whether his government would retaliate directly against the US if the administration moved forward with its plans, only saying that a trade barrier in principle "doesn't make good policy sense".
Prime Minister Malcolm Turnbull spoke out strongly against import barriers Sunday, calling it a "dead end".
"Protectionism is not a ladder to get you out of the low-growth trap, it is a shovel to dig it a lot deeper," he told reporters in Sydney.
Ciobo said Friday Australian steel and aluminium only accounted for a small per centage of the US import market, but warned the tariffs would distort trade and lead to a loss of jobs.
Fears of a global trade war and counter-measures grew over the weekend, after Trump threatened the European Union's auto industry if it enacted retaliatory measures to his steel and aluminium sanctions.
The European Commission chief's Jean-Claude Juncker said Friday that the EU was drawing up measures against leading US brands such as Levi's and Harley-Davidson.
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