(Bloomberg) -- China's former commerce minister said he worries a trade war with the U.S. is coming, warning it would hurt both countries and leave a trail of destruction across Asia.
“I'm seriously preparing for a trade war,” Chen Deming told reporters Monday on the sidelines of the annual National People's Congress in Beijing. “Trade volume between China and the U.S. is huge,” he said. “Both of us will be weakened and wounded by a trade war, and the global community will also be damaged.”
During his election campaign, U.S. President Donald Trump accused China of stealing American jobs and intellectual property. While he has backed away from initial moves to link China's trade activities with the broader policy that governs Taiwan relations, he has yet to set out specifics on how he might pressure Beijing.
U.S. Commerce Secretary Wilbur Ross, who has described China as the “most protectionist” major nation, said last week that the U.S. was preparing cases against China and other nations and would pursue “tougher enforcement” of existing trade rules.
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“I'm preparing for some solid counter measures to reduce or limit our damage if there's a trade war with the U.S.,” Chen said. “I can't tell you what the measures are. I can't say I'm optimistic.”
Trade between the world's two biggest economies supports around 2.6 million American jobs, according to the U.S.-China Business Council. While the U.S. has a goods-trade deficit with China, its exports of services to the country are growing rapidly. Between 2006 and 2014, they climbed more than 300 percent.
In recent years, the U.S. and China had made progress despite their frictions because “we both understood that a trade war or anti dumping measures without basis in law makes no good to both sides,” Chen said. He was minister of commerce from 2007 until 2013, and is now president of China's Association for Relations Across the Taiwan Straits.
“Japan, Korea and Taiwan and the entire Asia region have benefited from China's trade surplus with the U.S. because their electronic components are all made here,” he said. “The entire Asian supply chain will be damaged by a trade war.”
To contact Bloomberg News staff for this story: David Tweed in Hong Kong at dtweed@bloomberg.net, Keith Zhai in Beijing at qzhai4@bloomberg.net.
To contact the editors responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net, Rosalind Mathieson, Brendan Scott
With assistance from David Tweed, Keith Zhai
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