22.04.202511:25 Forex Analysis & Reviews: China Issues a Warning

China has warned countries against making deals with the United States that could harm Beijing's interests, raising the stakes in the ongoing trade war with Washington. On Sunday, the Chinese Ministry of Commerce stated that while Beijing respects countries' rights to settle trade disputes with the U.S., it firmly opposes any party reaching an agreement that compromises China's interests. "If this happens, Beijing will never accept it and will resolutely take countermeasures," the ministry said. "China is ready to strengthen relations and coordination with all parties to jointly respond to and resist unilateral acts of intimidation."

The statement emphasized China's readiness for constructive dialogue and cooperation with all countries, including the U.S., but warned that it would not tolerate actions that undermine its national interests. Beijing urged all sides to uphold the principles of mutual respect and equal partnership in international trade.

The ministry's comments signal China's preparedness to firmly defend its economic interests amid rising geopolitical tensions. Beijing is likely to use all available tools—including diplomatic pressure and retaliatory trade actions—to counter any attempts to curb its economic growth or influence on the global stage. The future of the situation will depend largely on the willingness of all parties to compromise and engage in constructive dialogue.

To recap, U.S. President Donald Trump recently paused many of his planned tariff hikes for most countries for 90 days, but doubled tariffs on Chinese goods, triggering new chaos in global markets.

China's warning comes as countries prepare to engage in negotiations with the U.S. to seek reductions or exemptions from the sweeping tariffs introduced by Trump this month. Washington is also pressuring these countries to scale back trade with China to prevent Beijing from bypassing the tariffs.

According to media reports, Trump's top economic advisors are discussing asking other countries to impose so-called secondary tariffs—essentially sanctions—on imports from nations closely linked with China. Washington also wants its trade partners to refrain from absorbing China's excess goods.

As reported by Reuters, Vietnam is preparing to crack down on Chinese goods being rerouted through its territory to the U.S. At the same time, trade talks between the U.S. and Japan continue, though there has been no real progress despite Trump's bold public claims. A South Korean official is expected to visit Washington soon, potentially initiating a new round of negotiations.

"Beijing shouldn't be too concerned about the Trump administration forming an anti-China coalition," said Bert Hofman, former World Bank director, "because the U.S. is unlikely to succeed given its unpredictable policy-making style." However, Hofman acknowledged that China holds significant trade surpluses with several countries, and the best way to ease these tensions would be to boost domestic demand and coordinate with other nations. This approach could help avoid retaliatory tariffs in response to Trump's trade war.

Earlier this month, China responded to the new U.S. tariffs not only with its own tariffs but also by tightening export controls on rare earth metals. Exports of these materials were nearly halted as producers struggled to meet stricter licensing requirements. This could have a major impact on the auto industry, which relies heavily on such metals.

In an effort to counter recent U.S. moves, China has stepped up diplomatic engagement with Southeast Asia and Europe. Last week, President Xi Jinping visited Vietnam, Malaysia, and Cambodia to strengthen regional unity and build an "Asian family" that can better cope with the risks posed by Trump's tariff agenda.