Off-ramp to US-China tariff war
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00:00All right, Alexander, let's do an update on the US-China tariff war. And it does look like
00:08we are starting to get statements from both the US and from China that we could be moving towards
00:16some sort of de-escalation. I'm not quite sure how significant of a de-escalation is going to be.
00:24I'm not sure if we're getting any closer to some sort of a bilateral negotiation,
00:30which I imagine is the ultimate goal, is to get both sides at the table so they can discuss
00:36how to move forward, how to move towards a managed divorce, I think, is the best outcome.
00:43What are your thoughts on where we're going with the tariff?
00:46Absolutely. I think that is exactly what's happened. Now, I mean, there are a lot of reports
00:51circulating in the media, including the British media, by the way, that within two weeks' time,
00:57there'll start to be visible shortages of goods in US stores. And this is now putting pressure on
01:05Trump. I don't know whether that's true, could be. And there are also other reports that Chinese
01:11factories have stopped production. Again, probably true. But again, the extent to which that is true
01:17is difficult to say. But we've had the first comment from Trump. He speaks about the fact that
01:26China and the United States are going to see tariffs reduced. He importantly, he accepted,
01:35he acknowledged that the current tariffs are unsustainable, which is, of course, what we have
01:41been saying for the last two or three weeks. But he's accepted that the current tariffs that China
01:48and the United States have against each other are just unsustainable. He said the tariffs will come
01:53down. They won't come back down back to where they were before he was president. I don't think
02:00anybody accepts that. I don't think anybody in China accepts that. It looks to me as if he's trying
02:07to work his way towards a policy of protection, which is what we have been talking about. You can agree
02:15with it. You can disagree with it. But a policy of protection to protect US manufacturing industry to
02:22bring growth back away from the kind of outright economic wall, which we have been seeing develop
02:31over the last few weeks. Oh, there were important comments from Trump. Now, the Chinese have been
02:39making statements of their own. And here, I'm afraid there's been a great deal of misdirection, because
02:44there was a claim that the Chinese said that they would only talk after the United States rescinded
02:55all unilateral tariffs. In other words, all tariffs that Trump has imposed since he became president
03:02back in January. Now, I've scoured the Chinese media, the Chinese foreign ministry and other government
03:12websites to find confirmation of that. I haven't found it anywhere. It appears to derive from some words
03:20said by one official. What the Chinese are saying, and what the Chinese officially are saying is,
03:27yes, we are prepared to talk. We're prepared to talk on an equal basis. I mean, they clearly
03:35are not prepared to make massive concessions, but they're certainly prepared to talk. And I'm going
03:44to make a guess. I think at some point within the next two weeks, we will see a proper negotiation start
03:49to get underway. And the first steps will be taken to start to bring the tariffs down.
03:56What would that mean as far as the escalation that has already taken place, the 100%, 145%,
04:04125%? Are we going back to the baseline, to the 10% of the 20%? And then we're going to work
04:14things out from there? I suspect that Trump is going to go down to 20%. I think that's probably
04:20where this is going, actually. And what would China?
04:23Which I think the Chinese can live with. I mean, they don't like it, but I think they can live with
04:29it. There will probably be some reciprocal tariffs from China as well. But I mean, the point is,
04:35trade can happen at that level. It can't happen when tariffs are at 145% or anything of that kind.
04:45But it's a massive economic shock that we have seen. And as you completely said, it will basically
04:55be clear that the tariff moves that have happened over the last few weeks was China and the United
05:04States serving on each other, the economic divorce papers, because that's what it looks like.
05:09But at that point, we are into a situation of protecting American industry. It is no longer
05:17an economic war. It is no longer a project to destabilize China and crush its economy. And I
05:26think one of the reasons, by the way, why we've seen a softening of the American approach is not just
05:34because of all these reports about goods starting to run out in American stores. There may be some of
05:45that going on. But I think the major reason is that the Scott Besant idea that countries around the
05:54world would rally to the United States and that China would be economically isolated. That just
06:00doesn't happen. Didn't happen. Yeah. And getting to the bilateral agreements with other countries,
06:07whether it be India, which already had an agreement that they were working on before the Liberation Day,
06:13Japan, South Korea, all these countries, it was taking time. I think the Trump administration,
06:21maybe Besant wasn't aware of this. I find it hard to believe, but who knows? Maybe they didn't
06:26understand that trade agreements are not hammered out in a couple of weeks. They can take many months
06:33to years. And that's under ideal circumstances. That's under friendly circumstances. So all of this
06:41stuff was taking time and it wasn't working out the way they thought it was going to be. So
06:46is the US also going to remove the demand that countries don't trade with China? And is China
06:56going to take back their warnings to countries? If they did agree to the US's demands to not trade
07:07with China, this whole reciprocal warning thing that was going on. So all of that is going to
07:11likely go away? I think so. Yes, I think so. Because as I said,
07:15it hasn't worked. I mean, Xi Jinping has had a very successful trip in Southeast Asia. He's visited
07:20various ASEAN countries. He visited Vietnam, Malaysia, and Cambodia. And he seems to have been
07:28very well received there. J.D. Vance has been in India. I think that the Indians will have told J.D.
07:34Vance. Look, you know, we have our issues with China and they're very difficult and they're very
07:40important. And we do want to have very good relations with you. But it is simply not practical
07:45for India to cut off trade with China in the way that you say. China is now India's biggest trading
07:52partner. It is a vital investor in the Chinese economy, in the Indian economy. It is providing
07:58India with infrastructure investment, which India absolutely needs if it is going to grow its economy
08:06further. And it has expertise to do it. I mean, I've been in discussions with people about this.
08:12India simply cannot afford this kind of economic cut off with China that some people in the United
08:19States might have thought. So I think that we will see that, you know, these demands in the United
08:27States to stop dealing with China are going to gradually fade out. They probably won't be publicly
08:34pulled back. But the reality is the Americans will stop talking about them when they undertake these
08:42absolutely rightly, as you rightly say, very, very complex trade negotiations.
08:49The Chinese won't publicly take back their warnings, but their warnings won't be needed any further.
08:59And as I said, we'll be back finally to that position that arguably we should have been in in the first
09:05place, where the United States pursues, moves towards a protectionist trade policies, which, as I said,
09:14you can disagree with. But they have a long history, they're nothing fundamentally new, and they have
09:23their advocates. And, you know, for all I know, they might even work. I'm not saying they will. But,
09:29you know, it is a viable economic policy, or at least an economic policy that has a strong intellectual
09:38underpinning. So the United States can do that. And China and the United States can pursue this economic
09:45divorce that we were talking about when Trump was president during his first term, and which seemed to
09:51be progressing at that time, until his presidency was completely derailed. Two years in, after the
10:00Democrats gained control of the House, and everything began to go completely wrong with Russiagate and all
10:08of that. So I think that, you know, if nothing else, this has been a galvanizing effect. But we're starting
10:15to see a return to a more stable course than the one that we've seen over the last few weeks, and a more
10:25sustainable one. Off topic, but maybe not off topic, maybe not off topic, I'll ask you, and probably a video that
10:34we're going to, that we're definitely going to record at another time, but the tensions between India and
10:41Pakistan, do you think they're connected in any way to, to the, the tariff war, the tariff conflict between the US and
10:50China? Do you think there are other forces at work here? Just, just a quick, just your quick analysis
10:57there. And as I said, was we will get into depth on this topic in another video, but it does, it does
11:03seem that there, there could be some, some sort of connection there with everything that's going on in
11:09the world, trying to, to escalate, to stir up escalation between India and Pakistan. We had an
11:15interesting statement from the Pakistani defense minister who did say that this was some sort of,
11:22he hinted at, he hinted at the fact that this could have been a false flag. And he did say that
11:27Pakistan has been doing the, the dirty work of, of the United States for decades. Something along those
11:33lines is what he said. Interesting statement from the defense minister of Pakistan.
11:36It was a very interesting statement. I have absolutely no doubt at all that this is what it is all connected
11:41to do. None at all. But as you rightly say, this is something we do need to talk about more in much
11:47more depth. I should say that the next couple of days following this program will show the,
11:57our making of this program will show whether or not the situation between Pakistan and India,
12:03which is incredibly dangerous by the way. Remember they're both nuclear powers,
12:07whether it will escalate. The rhetoric from both sides is very strong. And the actions that each
12:14side has been taking against the other so far has also been very strong. It clearly, I've no doubt
12:22about this. It would not have happened had we not had this enormous crisis between the United States
12:30on the one side and China on the other. India is a kind of ally. Well, it's, it's, it's got a strong
12:38partnership, both with Pakistan. And now with India, its historical connection has been closer to Pakistan's
12:51than it has been with India. India historically was an ally or a friend of the Soviet Union, but Pakistan
12:58also has a very close relationship indeed with China, which is in some ways even more important
13:05for Pakistan than the one with the United States is. So undoubtedly, all of this is interconnected and
13:12it plays a significant role. But I think we need to have a better idea of where all this crisis is going,
13:18because flare ups and tensions between India and Pakistan are very common. This one looks like it could be
13:27worse than some of the others that we have seen. But I think a proper analysis of it needs, as you
13:36correctly say, a dedicated program, and perhaps a better perspective of where exactly it's going.
13:41The timing of it. The timing of it.
13:42The timing is, there's no, I mean, there is no coincidence here. Let me put it like that.
13:47Yeah. Okay. We will end the video there, theduran.locals.com. We are on Rumble
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