US PRESIDENT Donald Trump’s moves to hinder the rise of China’s economy and reverse the trade deficit is “ill-advised” and will only cause the US to “suffer more” in the long run, Alibaba’s head executives said Wednesday.
Speaking at the South China Morning Post’s (SCMP) China Conference in Kuala Lumpur, CEO Jack Ma said he didn’t understand the logic behind Trump’s approach of imposing tariffs on huge numbers of Chinese imports.
The business mogul also pointed out that America has benefitted from its trade relationship with China, predominantly due to outsourcing jobs to Asia’s biggest economy.
Despite fearing the tactics would damage global trade, Ma said he still remained “optimistic.”
Citing America’s US$350 billion trade deficit with China, and Beijing’s intellectual property theft, Trump has mounted up tariffs on large chunks of Chinese imports, causing the global economy to slow.
On Tuesday, the International Monetary Fund (IMF) released a report setting the world’s projected economic growth for 2019 at 3.7 percent. This signals a slowdown after it was lowered by 0.2 percent from original projections, due in large part to Trump’s policies.
“The forecast for 2019 has been revised down due to recently announced trade measures, including the tariffs imposed on US$200 billion of US imports from China,” reads the World Economic Outlook report.
The measures have also slowed China’s economy, dropping to 6.2 percent growth from a previously anticipated 6.6 percent.
Ma’s second in command at Alibaba, Joe Tsai, went further in his criticism of US tactics, saying Washington was pushing the sides into a “cold war or geopolitical war.”
“I think what the United States is doing is a reaction to an unfounded fear that China’s rise is somehow going to threaten the national security and well-being of the American people,” said Tsai, as reported by SCMP.
This fear was unfounded, Tsai said, due to the full integration of national economies; the only result would be global suffering.
“It is really ill-advised for the United States to launch a war of some sort targeting China thinking that they can treat China like the way they treated Russia by isolating the economy and bringing on pain,” Tsai said.
“We are so integrated that the pain is going to be felt all over the world. Everybody is going to feel the pain.”
But Trump shows no signs of slowing down his campaign. On Tuesday he repeated his threat to slap tariffs on an additional US$267 billion of Chinese imports if Beijing retaliates.
He also signaled the two sides were not close to reaching a deal despite months of negotiations.
“China wants to make a deal, and I say they’re not ready yet,” Trump told reporters in the Oval Office.
“I just say they’re not ready yet. And we’ve cancelled a couple of meetings because I say they’re not ready to make a deal.”
The White House has upped the ante in their disapproval of China in recent weeks, taking the criticism beyond just trade.
Both Trump and Vice President Mike Pence very publicly accused Beijing of trying to tamper in the US mid-term elections to harm Trump’s chances of success.
China was forced to deny the accusations at the United Nations General Assembly, but Trump’s administration has not given up on the accusation, despite offering no evidence to support their claim.