Cargill: Cost of international trade war too high
Following on from the recent concerns about Chinese retaliation raised by US feed grain associations last week over US President Trump's tariff proposals, US-based agro-giant Cargill has weighed in on the discussion.
“The impact of trade conflict between the world’s two largest economies could lead to a destructive trade war with serious consequences for economic growth and job creation,” a spokesperson for Cargill told FeedNavigator. “We urge caution for both countries as there are no winners in a global trade war.”
Trade concerns and considerations
The Trump administration signed a tariff order on aluminum and steel on March 8, although several countries were excluded from the additional fees. Last week, the administration also said that it was considering additional tariffs on multiple Chinese products following an investigation from the US Trade Representative into China’s actions, policies and practices relating to intellectual property, innovation and technology transfer.
Chinese officials with the Ministry of Commerce responded to the proposed US tariff measures:
“The fact that the United States imposed tariffs of 25% and 10% on imported steel and aluminum products on the grounds of ‘national security’ actually constitutes a safeguard measure,” the ministry spokesperson said in translated remarks. “According to the relevant provisions of the WTO’s Agreement on Safeguard Measures, China has formulated a list of suspension of concessions.”
'Trade wars bring too high a cost'
Cargill said that it was concerned about the “increasing trade tensions” developing between the two countries.
Trade wars bring too high a cost, the company said. “Open trade has allowed economies to reach across borders to obtain goods, services and capitals supporting the farm economy,” it added.
Trade needs to be conducted within a rules-based-system, the company said. A system is needed to establish that all participants have the same options and opportunities, and that trading partners have “the same responsibilities, equal access to markets and an equal opportunity to compete in those markets.”
WTO rules
The Chinese ministry also said China does not want to fight a trade war, but is not afraid to do so. “It is hoped that the US will pull back before it is too late and not drag bilateral economic and trade relations into danger,” said a Chinese official said [Translated comments].
“The US acts in disregard of China’s efforts to strengthen the protection of intellectual property rights and the voices of the broad masses of the industry, ignoring WTO rules,” the ministry spokesperson said. “It is a typical unilateralism and trade protectionism, to which China firmly opposes. This move by the US is neither conducive to the interests of China, nor those of the United States. It also goes against the global interests, a very bad precedent.”
