China’s “fight to the end” – A strategic response to U.S. tariffs
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China has vowed to fight to the end, following the US threat to impose an additional 50% tariff on Chinese goods. The leaders of France, Egypt and Jordan are jointly calling for an immediate ceasefire in Gaza.

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Beijing has denounced Washington's threat to impose 50% additional tariffs on China. The Chinese Commerce Ministry says in a statement that the threatened additional tariffs are a mistake on a mistake, urging the U.S. to immediately rectify its wrong practices and cancel all unilateral tariffs.

It says China would not back down if the U.S. insists on having its own way. He also expressed the hope that the U.S. can resolve disagreements through dialogue based on mutual respect.

Beijing announced last Friday it would impose a 34% tariff on imports of all U.S. products starting this Thursday, matching the latest duties by the Trump administration. Trump threatened additional 50% tariff if China does not withdraw its 34% duties on U.S. imports.

So to delve into the U.S. abuse of tariffs and its broader implications, let's bring in Dr. Yao Shujie, Chang Kong Professor of Economics at Chongqing University, and Dr. Joseph Mahoney, Professor of Politics and International Relations at East China Normal University. Welcome, gentlemen. Hi. Thank you.

In today's interconnected global economy, the United States' abusive tariffs is like a storm, disrupting the global economic order and injecting instability across nations. Let's start with China's response. Professor Mahoney, after President Trump threatened to impose additional 50% tariff on Chinese schools,

China's Ministry of Foreign Affairs vowed to fight to the end. How do you interpret China's stance here? And what does this response tell us about the level of preparation China has already made, whether in terms of countermeasures, industrial restructuring or expanding international cooperation to deal with a potential escalation of a trade conflict?

Well, I think there are two points here. The first is China is well prepared to fight this toe to toe. Otherwise, we would not see Beijing meeting this aggression head on. We would see them doing something like the EU is doing now, which is, you know, trying to do whatever they can to negotiate a resolution.

And a number of the things that you have mentioned, the fact that they've been restructuring their economy for several years, the fact that they've been building alternatives to SWIFT, that they've been clearing accounts through local currencies, all of these things have left China in a position so that they're not as vulnerable as they would have been in the past. But the second thing to note here, I think is a bigger question,

is why the US seems to have failed to anticipate China's strong resistance, as many are suggesting in the Western press. Now, if this is true, and if so, then why? Some have suggested that Trump misread China's conciliatory responses to his election and the reciprocal but measured responses China took to the first new interims imposed by the White House after he took office there for the second time.

Now, some have, I think, somewhat radically suggested that China may have intentionally tricked Trump into thinking China was unwilling to fight, essentially baiting him into a conflict that he thought he could provoke, but then avoid with China, you know, in his mind, ready to offer concessions. Now, I'm not sure that's how we should read this presently, but my sense is Trump severely misjudged China's resolve or didn't, in which case this is a conflict that he wants to

and he'll narrow his focus accordingly and start cutting deals with others. So on the whole, I favor those who believe that he grossly misjudged China's capacity to fight and willingness to fight. Professor Yao, do you share the same stance? How do you rate the level of preparation China has already made?

Well, you look at the past, you know, Donald Trump's first term in 2017, 2018, he started to, you know, test the water, how China may respond to his very tough tariff policies. At the time, he imposed 20%.

And Biden administration actually follow the same sequence of Donald Trump without getting any concession. And eight years of trade conflict against China, it seems that the U.S. doesn't have to infringe any serious consequences on the Chinese economy, in particular the Chinese international trade.

So Donald Trump, after he resumed the office this year, he took about three months to work it out. And work would be the potential measure that can render China to surrender. And he calculated that maybe 34% would be sufficient, because 34% plus 20% is 54%, and that would be devastating.

Unfortunately, China actually had prepared very well over the last eight years, thinking about how the second term of Donald Trump being imposed and the worst scenario is total decouple. Now, of course, China has prepared for the worst scenario, total decouple. Because total decouple, there will be devastating consequences to both parties.

I think not only China is going to be damaged, but the US is to go out with a heavy price to pay. This could be devastating to the fundamentals of not only the international trading system, but also the US economy. So China always says we will make compromise if we can negotiate.

But China will not tolerate any more, you know, hesitancy, any more elegance of Donald Trump to impose any must-tell as possible. Because by concessioning, China didn't get any, you know, compromise from the Donald Trump administration because he's a, you know, ruling style, highly unpredictable. And he always considered the U.S.,

is so superior that nobody in the world, including China, could actually challenge the US permanent and dominant position. But this time, I think China is well prepared to take on the shock. And once China has made the determination,

it would be very difficult to make compromise like the European Union. It's simply because the European Union is very fractional and also it is a small economic bloc.

And also, you know, Donald Trump actually hasn't hit very hard on the European Union. So the European Union is naively, you know, hoping that Donald Trump after negotiation would be compromising. Maybe he will compromise. Who knows? But he will not compromise with China.

And because of the attitude of adamant not to make any compromise, this is why China has no hesitance in triggering the retaliation measures. And if another 50% increase is imposed, I think we will see there will be more or less total decouple between the US and China.

Professor Yao, that reminded me once President Xi Jinping remarked, China's economy is like an ocean, not a small pond. In the context of this round of U.S. trade pressure, how does this metaphor reflect China's strategic resilience? Well, probably Donald Trump didn't read very well about China's strategy during the COVID-19 pandemic in 2020.

The Politburo had an emergency meeting and discussed how to deal with the couple from the US and the US Airlines.

So the so-called double circulation, you know, new strategy, it means China would have to rely more on the domestic economy than the external economy, although China will still keep the door as widely open as possible.

So at a certain level of openness, China is going to prepare for the worst scenario, including the tariff war launched by Donald Trump. China would have to rely on the domestic circulation, which means the domestic market. In Manchuria, China has 1.4 billion people. The number of people is four times the U.S.

Although the US economy in absolute size seems bigger than China, but China exports more commodities than the US. And also another potential issue is not only the merchandise trade, there's also service trade. The service trade, the US, has a huge surplus against China. So China actually hasn't targeted the service trade.

If the U.S. is going to impose 104% tariff on Chinese merchant trade, I think China would do more than just the merchant trade.

And this is going to have more devastating consequences on the U.S. economy. Professor Mahoney, what's your take on President Xi's remarks that China's economy is like an ocean, not a small pond? And how does it reflect China's economic resilience today? Well, I think there are two aspects here. First, there are some economies that are very small economies.

like a pond and easily intimidated. And we've already seen some of them running as quickly as they can to Washington to try to cut a deal. And these include countries that depend on the US economically and militarily for security. Now, China does not depend on the US for either of these things. Certainly it does a lot of trade with the US, but its economy is no longer dependent on that trade. A second, I'll be a bit poetic here. Most of the world is an ocean.

And most countries in the world count on China as their biggest trading partner. China moves its products across the ocean at a constant rate. And we know that China, by some reports now, is clearing half their trade through non-Swift related financial systems and avoiding the dollar. Only around, I think, an estimated 14% of the Chinese economy is directly at risk in the U.S. So this is a significant number.

And China is still relying on the dollar for a lot of its transactions. But it can manage that loss and it can manage going ahead and transitioning to a different system. These are things that China is prepared to do. It will be a painful transition, but ultimately it will be one that will leave China in a better position down the road.

Professor Mahoney, let's return to the specific details of U.S. tariffs on China. Trump has threatened a new 50% tariffs hike on top of the already imposed 54% cumulative tax on Chinese goods. What do these figures mean in practical terms? For American consumers, for example, how will this affect the prices of Chinese-made goods today?

Well, you know, I'm not an economist, but I think that when we saw the first 34%, there were some initial calculations that that would add $3,500 increased costs for American families.

if that policy was to stand. There were also some analyses that suggested that it would take about a year for those costs to accumulate because, you know, people... It's an annual cost, but also it takes time for all those things to trickle down and actually hit consumers. And we know that Trump is threatening and pressuring U.S. businesses not to pass on those costs, but ultimately that's not going to work out for him. But, you know, to...

I don't think we've yet seen an estimate of what happens if he adds another 50%. Maybe rough math is that it more than doubles. I just don't see how that will be able to

survive politically. I don't see how Republicans will be able to sustain their position in Congress. I think we'll begin to see, we're already seeing a number of people break ranks with Trump. We've already seen a number of politicians question. We've seen a number of his supporters who supported him on Wall Street starting to break ranks. So I think he has to find a resolution to this sooner or later. I think he's hoping that an additional 50% would break China. It won't.

And here, to go back to what my colleague was saying, I think one of the key lessons that China has taken is from Canada and Mexico.

Trump forced these two countries in his first term to renegotiate NAFTA. And then after he took office, he hit them again and blamed them in addition to that for US problems like failed immigration control and drug addition. And these are also problems that he pushed towards China in the first round of tariffs.

and at the same time we have to we have to put in mind that uh that uh there are reports uh that that uh you know that trump will at some point impose dockage fees of 1.5 million on shipping companies uh using or even owning chinese ships if they if they uh dock at an american port so you know the fact of the matter is trump is only uh

He's going to keep taking regardless. He keeps taking even though he's negotiated deals. You can't really trust him to stick with a deal. I think the other thing, the other context here is that he feels increasing pressure to win this conflict with China, although I don't think he can because we have to see that his policy in Ukraine is failing. His policy in Gaza is failing. And this...

This is distracting. This trade war escalation is distracting people from these other failures. But all of his major promises that he had, that he was going to accomplish very quickly in office, are failing to materialize. And I think this is, that we have to look at this collectively and say, there's something categorically wrong with his understanding of American strength and ability to coerce others to do what he wants. Mm-hmm.

Professor Yao, what's your thoughts on this new 50% tariff hike on top of the already imposed 54% tax on Chinese goods? And how will this affect both China and the United States? If another 50% rise in the tariff on Chinese imported goods into the United States, the cost could be shared by the U.S. consumers and the Chinese producers.

If half of the cost is shared by the Chinese producers, I don't think the Chinese producer will produce anything for the United States because the profit margin would certainly not 50%, by the way.

But for the US consumer, the 50% they have to pay is actually a painful cost for the consumer. Even just 34%, my colleagues just say each US normal family have to pay additional US$350 for their consumptions. So another 50%, that means there will be about 7,000.

which is going to a significant cost and it's going to involve a lot of protection by the consumer on the american street in the major cities so the pressure on the donald trump is very high my colleague just mentioned my only just mentioned donald trump actually promised to bring the war uh the ukraine war to an end and he i give you know his including his vice president mr vance

The video has lots of humiliation against Zelensky. And Zelensky is very resilient. He's not going to end the war so easily by the United States. And although Donald Trump says, "Oh, you don't have any more car to play," but actually he has some car in the European Union to play.

So, in a sense, Donald Trump totally overestimated his ability and America's superpower capacity to contain anyone in the world or to contain all the people in the world in his waste.

Now, I don't think that in his second four-year term he cannot do whatever he likes, because the rebellion by Zelensky is one example. And China's fairly prone response to the US Tally is also another fairly strong signal.

America, it's not easy to bring down China because China, after all, is a big ocean, it's not a small pond, as President Xi Jinping just pointed out. There are so many people in China, there are such a huge market in China and the Chinese industry is so complicated, so sophisticated, it's not going to be contained by the US because up to all China can actually

uh export the good to other countries and also can increase domestic consumption to digest the over capacity which could be created by the uh you know more or less decouple from the US market I know it is very very painful China is going to suffer heavily but Donald Trump is not going to fulfill the objective of bringing China down I think that's what you want

And it's not easy to bring China down. China was so very strong resilience, not only international trade, but also technological innovation and the general economic development. It was so to Donald Trump. Hang on, China is not a small baby, it's a very big baby. You have to treat China extremely carefully.

But Professor, according to CNBC, Apple has emerged as one of the hardest hit US tech firms in this latest phase of tariff war. Its stock fell for three consecutive trading days, wiping out nearly 640 billion US dollars in market value, roughly equivalent to Argentina's GDP back in 2023.

Globally, nearly 9.5 trillion US dollars was erased from equity markets in just three days. But Trump dismissed these fears, calling it just a short-term pin. How do you interpret his remarks here? And what's Trump really hoping to achieve through this global trade war? I think the stock market has seen significant turbulence on both sides of the Atlantic and the Pacific.

You see that on Thursday, Friday last week, the three major indices dropped down by 10%. And they come across to Europe, to Japan, to the rest of the world. In China, you have a significant decline in the global market. But the Chinese authorities, they stepped in to support the stock market.

And the major sufferer of Apple, you just mentioned, and also the major seven largest listed companies, the high-tech companies in the stock exchange, they suffer so much significantly. It will create a fairly strong negative impulse response to the investor confidence.

This is certainly, you know, some analysts and politicians in the United States that the stock price plan could be due to the deep seat, the Chinese AI machine, the platform.

Which means that China is not only competing with the United States in terms of international trade, but also the AI technology. This is why China has such confidence and such a lack of hesitance to respond to the United States.

And I think if the war, the trade war and technological war between China and the United States is going to hit the U.S. economy really hard, in particular, you know, the stock exchange, the strength of the U.S. dollars and also the U.S. agricultural sector, I think the U.S. would feel the fairly pain in the neck.

and they will come to make some compromise with the rest of the world, particularly with China. Although this is the scenario that some people, some analysts in China are hoping for. Although the US may actually show out to be more resilient than this, but we have to see the evolution of this trade war evolving, particularly the stock market.

Professor Mahoney, what do you think is the rationale and intention behind Trump's tariff policy by calling it a short-term pin? Well, let's be clear. It's not short-term paying for people who are losing money, which includes a lot of Wall Streeters who supported him and now feel betrayed by him. And it's not short-term paying for people who will lose their jobs and face higher costs. I agree with a point that Professor Yao made earlier that if we see this 50% increase

added by the U.S. And if we see this rate sustained, because, you know, China will then respond with in kind and then I don't know what Trump will do. But as Professor Yao said, even if we add another 50 percent, we'll be at 104 percent. And then we're likely to see Chinese producers not producing for the American market. Thanks, Professor. You are listening to World Today. We'll be back.

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This is World Today with Mika Anna in Beijing. U.S. President Donald Trump and Israeli Prime Minister Benjamin Netanyahu have met at the White House. The two sides focused on the Gaza hostage crisis and U.S. tariffs on Israeli goods. Trump did not discuss any long-term plans for Gaza's redevelopment. The meeting highlighted the complex relationship between the United States and Israel, balancing security concerns with economic interests.

Both leaders pledged to continue working closely on these issues. For more on this, my colleague Zhao Ying joins us in the studio. Thanks for joining us, Zhao. Thanks. What were Netanyahu's main goals in making this trip to Washington, and what does the timing of this visit tell us about his priorities?

I think the visit appears to have been driven by two primary objectives. First, Netanyahu is seeking to address the economic implications of Trump's tariff policy, which imposed a 17% levy on Israeli goods entering the U.S.,

As Israel's largest trading partner with the U.S., I mean, there is a bilateral trade volume of 37 billion U.S. dollars last year, and the U.S. market is critical to Israel's economy. And secondly, I think Netanyahu aims to align Israel's strategic interests with

with Trump's broader Middle East agenda, especially regarding the Gaza conflict and the tensions with Iran. And as for the timing, Netanyahu was actually the first foreign leader to meet with Donald Trump at the White House since Trump announced the sweeping tariff policy last week. And I think this indicates that Netanyahu prioritized an immediate response to the economic pressure of the tariffs

which, according to the Manufacturers Association of Israel, will cost Israel about $3 billion in exports each year and lead to the loss of 26,000 jobs in industries that include biotechnology, chemicals, plastics, and electronics.

But also the visit comes just days before Trump's planned talks with Iran on Saturday. So it also reflects Netanyahu's intent to play a role in the U.S. Middle East policy. Building on that, Netanyahu pledged to eliminate Israel's trade surplus with the United States, which stood at $7.4 billion last year. What exactly does this mean in practical terms and how realistic is it?

Well, that means Israel has to either buy more American goods or reduce Israeli exports to bring trade into balance because Trump sees trade deficit as a sign of unfairness. And Netanyahu has already taken steps in this direction by canceling all the remaining tariffs on U.S. imports as of last Tuesday. And he has also promised to eliminate trade barriers. And these are all aimed at boosting American goods entering Israel.

However, the feasibility of this commitment is a matter of considerable debate because, first of all, the two countries have a free trade agreement that's been in place since 1985, under which 98% of U.S. goods entering Israel are already tax-free. So there's really limited room for further import growth.

And on the export side, the key drivers of this surplus are high value goods like machinery and medical equipment. And reducing exports in these fields can have a huge impact on Israeli economy, although Donald Trump's new tariffs may shrink the surplus by itself by making Israel's goods less competitive in the U.S. And of course, that's driven by U.S. policy, not Netanyahu's choice.

So Israel's export-driven economy relies heavily on the U.S. market, and I don't feel it's very realistic to eliminate the trade surplus in a short period of time. Despite that pledge, Trump has said the U.S. will likely keep the new 17 percent tariff on Israeli goods, adding that the U.S. already gave Israel billions of dollars in aid for defense and other purposes.

What does this tell us about Trump's strategy when it comes to negotiating tariffs with allies, even close ones, today?

I think Trump is indicating that allies like Israel benefit significantly from the US support, and therefore they should be willing to make trade concessions in return. And that is, of course, part of his America First policy, where every relationship, whether diplomatic or economic, is transactional. And I think the outcome of this meeting was

where Netanyahu leapt without a tariff reduction, may signal to other U.S. allies that no relationship is special enough to avoid economic pressure from the U.S., and it may drive them to seek alternatives or become more hesitant in their dealings with Washington. And they may start to question whether their security or trade ties with the U.S. will ever be fully stable or predictable under such policies.

And it also risks isolating the U.S. from the global economy at a time when it should be working together with other countries to address the shared global challenges. Also, the leaders discussed the ongoing war in Gaza. Nenia Hu mentioned working on new hostages for ceasefire deal. What challenges do you foresee in these negotiations and how might Trump's involvement influence this process?

Well, a primary obstacle is the fundamental difference in their goals, because Hamas has historically demanded a permanent ceasefire and a full Israeli withdrawal from Gaza, while Netanyahu's government focused on dismantling Hamas's military capabilities. And this creates a significant gap that has stalled prior talks.

And as for Trump's involvement, of course, he can continue to play a mediating role, but his focus on prioritizing Israel's security may reduce his willingness to pressure Israel into making significant concessions that could be seen as weakening its position vis-a-vis Hamas.

This might limit the effectiveness of any U.S. role in encouraging a balanced and sustainable ceasefire agreement. Trump also announced plans for direct talks with Iran regarding its nuclear program, while Iran insists there would be indirect discussions through Oman. What's really happening there, and what can we expect from these talks?

I think this apparent discrepancy is shaped by mutual distrust and differing strategic goals. Because Trump is perhaps trying to position himself as the diplomatic leader who is willing to make history by directly engaging with Iran. But Iran's preference for indirect talks reflects their deep mistrust of the U.S., especially after the Trump administration's decision to unilaterally exit Iran.

the JCPOA. And Iran's leadership likely sees direct engagement with the U.S. as politically risky, both domestically and internationally, as it could be perceived as giving in to U.S. demands without securing significant concessions in return.

So I think what's really happening here is a cautious re-engagement after years of stalled diplomacy. And that's partly due to Iran's weakened regional position and its economic strength from sanctions.

But on the other hand, the Trump administration is looking for a more comprehensive agreement that not only limits Iran's nuclear activities, but also addresses its missile program and its involvement in regional conflicts.

And realistically, a comprehensive agreement by Saturday is improbable, I think. At best, we might see a framework for further talks, and at worst, a breakdown could escalate the tensions. Nenia, who also mentioned the Libya model as a framework for Iran, can you explain what that means and how Iran might view that suggestion?

Well, the Libyan model refers to the 2003 decision by Libyan leader Muammar Gaddafi to give up his weapons of mass destruction programs in exchange for normalized relations with the West. Netanyahu's endorsement of this model for Iran implies a demand for complete and verifiable denuclearization, which goes beyond the partial rollback of the 2015 nuclear deal, which allowed Iran to retain

limited enrichment capacity under strict oversight. Iran, however, is almost certain to view this suggestion with profound skepticism, if not outright rejection, because the Libya model carries a cautionary tale for Iran.

Gaddafi's disarmament, which was hailed as a diplomatic triumph in 2003, preceded his overthrow and death in 2011 during a NATO-backed uprising. And unlike Libya, whose nuclear program was rudimentary and unoperational, Iran's infrastructure is advanced, widespread, and deeply entrenched.

So I think Iran is more likely to favor a revised 2015-style deal with temporary caps on enrichment and sanctions relief over a Libya model that could leave it defenseless. Thanks, my colleague Zhao Ying. Coming up, the leaders of France, Egypt and Jordan are jointly calling for an immediate ceasefire in Gaza. This is Road Today. We'll be back.

Hello, I am Dr. Digby James Wren, a political analyst and international relations scholar specializing in China area studies. World Today offers unmatched in-depth perspectives on China's politics, economics, business, technology and society. World Today's team of reporters and contributors provides valuable information from all of the world's major economies. I hope you can join me on World Today for the very best insights and news from China, on China, and help to build a better understanding of China's role in the world today.

You've been listening to Road Today. Now let's turn to the latest diplomatic efforts aimed at easing the Gaza crisis. The leaders of France, Egypt and Jordan are calling for an immediate ceasefire in Gaza. They met in Cairo, urging Israel and Hamas to resume negotiations for lasting peace and the release of all hostages.

To help us unpack the geopolitical dynamics at play, let's have Dr. Wang Jing, Associate Professor at Northwest University in Xi'an, China. Thanks for joining us, Professor Wang. It's my pleasure. To begin, Egypt, Jordan and France have come together at this particular moment to discuss the Gaza crisis. From a geopolitical standpoint, why do you think these three countries specifically have chosen to engage now?

I think because the three countries on the one hand have very close concerns over what is happening in the Gada Strip. And on the other hand, all of the three countries actually are very closely connected.

attended or closely have the connections, close connections with what is happening in the Gada Strip. Because on the one hand, we know that the Gada Strip is located at the very eastern Mediterranean. And we know that as a country, as a European country, France

in history has a very close concerns in the regional affairs, particularly in the eastern Mediterranean countries and the Mediterranean coastal affairs. So for example, what is happening in Syria, what is happening in Lebanon, what is happening in Palestine and Israel, all with the checks attention from France. So that is why France want to play the kind of role. And on the other hand, we know that

for example, some Arab states such as Egypt and such as Jordan. We also have the close connections with what is happening in the Gaza Strip. For example, that there were a lot of Palestinian civilians inside the Jordan territory. And also what is happening in the Gaza Strip could further influence

the situation inside Egypt. So that is why France, Jordan and Egypt and other maybe Arab states, they all want to play the kind of role for facilitating the possible restarting peace talks between Israel and Hamas. And also they want to encourage both Israel and Hamas to step further to find ways out to start the new possibilities of

uh peace so that is why i think these these countries they represent their willingness to engage closely with what is happening in the gada strip and they hope to bring peace back to the region professor given the active mood by these three countries how urgent is their call for an immediate and permanent end to the hostilities especially in light of the complex and volatile situation on the ground

I think these kind of the meeting or these kind of voices from all of the three countries is very crucial because we know that during the past one or two months, a lot of things changed because if we were looking at what was happening in this January,

a lot of motivations, a lot of forces are encouraging both Israel and Hamas to negotiate, to find peace with each other. But then after more than two months, what we are looking at right now is that everybody or majority of the international community are ignoring or forgetting what is happening in the Gaza Strip. And nobody really cared about what is happening between Israel and Hamas. So that is why

Hamas feel they are forgotten and the people in the Qaeda feel that they are forgotten. So that is why when the voice is spoken out from these three countries and when the encouragement comes out from these three countries towards Israel and Hamas, it means a

new motivation would be inserted into the possible process of peace for Israel and Hamas and a new kind of channels could be further established. So that is why I think this moment, at this very critical moment, the voices from these three countries are very crucial and important.

But Professor, despite the cause for a ceasefire, we see Israel continues to pursue its military operations with a firm hand. Based on Israel's historical moves, how likely is it that these diplomatic appeals will persuade Israel to pause or stop its actions in the near term?

I don't think Israel will be affected because Israel will continue to work based upon its own will. We know that Israel believes that on the one hand, they are still in a kind of war status and they believe that the war against Hamas should not be stopped

and the war in the Gaza Strip and the military actions in the Gaza Strip should not be suspended. And the kind of the buffer zoo or the kind of the new political and military scenario in the Gaza Strip should be reconstructed based upon Israel's own strategic willingness. So that is why Israel does not want to stop their military actions and does not want to stop their political and military activities.

And on the other hand, when Israel imposed pressure and very little has been done by the regional countries as well as from the international community. So

when no forces could stop Israeli's military and the political and its replacement activities in the Gaza Strip. So that the Palestinian people, particularly from Hamas perspective, they will feel disappointed or they will feel despair. And I think they will try their best to launch kind of the revenge against the Israeli targets. So that is why they enter a new kind of the military circle and a conflicting circle. It will be dangerous for everybody.

So that is why the voices from the three countries will be very important, but that would be far from enough. Professor, while this meeting took place in Egypt, Israeli Prime Minister Benjamin Netanyahu was also meeting with U.S. President Donald Trump at the White House.

to discuss the ongoing hostage crisis. How do you assess the role of the United States in the current Gaza conflict today? And what potential influence might Netanyahu's visit to Washington this time have on the crisis moving forward?

I think this meeting is very important because actually it will coordinate the United States and Israeli stances in the Middle Eastern affairs, particularly what is happening, the most depressing issues, not only for the Iranian nuclear issue, but also for the Palestinian Gaza Strip issue. So I think the two countries would...

will try to find new consensus. But I don't think their stances will be the same or will be closely coordinated because from the Israeli perspective, they want the war to continue. They want the United States to give more assistance and give more guarantee to continue the hostilities, to continue the crisis in this region.

Therefore, that Israel will feel secure, that Israel will feel safe. But from the perspective of the United States, they want to kind of pressure and impose it to Iran, to Hamas, but this pressure should be turned into the concessions from Tehran, from Hamas.

rather than the endless pressure imposed from the United States that would not be in accordance with the United States' interests and strategic interests in this region. So that is why I think both sides will coordinate, and they may talk a lot about what is happening and what should be done in the future in the Middle East, but I don't think that their stances will be coordinated

for 100%. I think divisions will emerge and the two countries will, maybe the bilateral relations will face new problems in the future. Thanks, Professor, for your insight of analysis. That was Dr. Wang Jing, Associate Professor at Northwest University in Xi'an, China.

The world's manufacturing PMI showed a notable decline in business activity in March, with a significant drag from the Americans. This is according to the China Federation of Logistics and Purchasing. The global manufacturing PMI index was 49.6 in March, down 0.4 points from the previous month. The American's manufacturing PMI fell to 48.9, a sharp 1.3 point drop from February.

So for more on this, our Zhao Yang spoke with Yan Liang, professor of economics at Willamette University. So Yan, what are the main reasons for the drop in the world's manufacturing PMI last month? And what does it reflect for the global economy? Well, I think since Trump was elected and inaugurated,

He's been talking about tariffs. He's been talking about tariffs war and he has been announcing tariffs in the month of February. And so I think, you know, all of this in a way would throw the global manufacturing sector in some sort of tailspin. Right. Because people don't know.

how his tariff plan is going to pan out. And in hindsight, it does have really big, you know, effects, disruptive effects in the global trading system. And of course, as a result of that, in the global production system. So I think

At that point last month, there was a lot of talks about policy uncertainty. And I think that definitely plays a dragging role on the global PMI because as you know, the PMI is a forward-looking indicator. It looks at how purchasing managers are planning on their manufacturing purchases and production.

So I think back in February, there was already a high level of uncertainty because of Trump's tariff policies. And so I think that is what contributed to the drag on the manufacturing PMI back in February. And the U.S. manufacturing sector also slided back into contraction on both the supply and demand sides. So what are some of the main reasons behind and would be a long term trend?

Yeah, I think this is a great question. I think, again, so this PMI that you mentioned that has slid was the data for March. So, again, I think that it's before, you know, this April sort of liberation day shock.

But I think, again, going back even in March, there have already been some tariff announcements. There have already been some heightened uncertainty. And so I think that, in a way, is really going to affect the supply side. Because as we know, for manufacturing production, typically the investment takes years. And so when you have policy uncertainty, that is going to affect supply.

you know, businesses long term planning and therefore, you know, how they're going to expand production or not going forward. And of course, back in March, we also have seen the U.S.'s policy, especially like the DOGE, right, the Department of Government Efficiency, has been cutting government projects, reducing fiscal spending and also rescinding some of the government contracts.

So all of this, I think, in a way will affect negatively the manufacturing sector. And the demand side factor, I think it's also plays a similar role, right? Again, as a consumer or as businesses, when you're not certain what the future is going to look like, you are not going to demand manufacturing goods, including machinery or consumer goods. And so I think that would also explain some of demand side slag.

So again, I think it has a lot to do with both counterproductive policies when it comes to tariffs and also government program cuts, government spending cuts, as well as the heightened uncertainty that's relating even more cuts and more tariffs down the road. And all of these, I think, happened in March. And it's definitely going to pan out even more in April, as we saw recently, really the market has been rattling.

So whether or not that would turn into from a monthly basis to a more year-long or even beyond sort of a long-term evolution, I think it really depends on how the current tariff war is going to play out. But again, giving so much uncertainty. So that heightened uncertainty, I think, could easily take this monthly changes into year-long trend and even beyond.

And now as the U.S. so-called reciprocal tariffs trigger the global responses, JPMorgan has revised up its prospects of a risk of a global recession this year to 60% from the previous 40%. So to what extent will Trump's trade policy hit the global supply chain and the economy? Could you elaborate more on that?

Right. So the tariff on those 60 countries that are higher than the cross the board 10 percent is going to take effect on April the 9th. So, again, now there are negotiations going on. But I think for I think whatever that negotiations may look like, it will still be a major disruption in the global supply chain. Just because, again, with the heightened policy uncertainty, if the tariffs are going to

be, you know, put in place as planned or it will be some kind of reduction or even escalation because Trump has threatened, you know, to tariff China now even more additional 50%. So I think with all these, this is going to disrupt the global supply chain in a very, you know, a tremendous way because the United States is a big, you know, importer, right? $3.3 trillion import last month, last year.

And with the United States renamed from the global trading system, what that means is that countries would have to reshuffle and businesses would have to reshuffle their supply chain. So this is going to be a major change in the global current trading and global supply chain arrangements.

But again, I think even though the US it's important, it only accounts for about 14% of the global trade. So what came out from all the chaos could be a restructuring of the global supply chain that is more resilient, more diversified, and it could be something brighter down the road. But at least in the median term, I think the disruption will be very sweeping.

Not to mention, I think the economy, we have seen the global stock market has experienced major sort of bloodshed and a bloodbath. And the United States, of course, is one of the major negatively affected markets.

So I think with a stock market turmoil, what that means is that households will be affected with the negative wealth effect that's going to depress their demand. Businesses, of course, would also be affected in a very significant way because if their stock value down,

That means they again will scale back their investment, their hiring decisions and so on and so forth. So I think that's why JP Morgan has raised the global recession. You know, the probability, as you mentioned, from 40 percent to 60 percent. And so and

Many people are start talking about more, you know, the scenario of stagflation where the economy is going to slow down because of these tariffs and the disruptions on supply chain on investment. On the other hand, you could have heightened inflation, right, because these tariffs adds to the imported cost and also affected domestic price levels and changes.

So all of this would mean the economy is going to take a major hit going forward. And not long ago, economic and trade officials from Japan, China and South Korea, they met each other talking about closer cooperation in terms of the economy, trade and investment. So are we going to see that Trump's tariff might provide more rooms for these countries to further cooperate with each other?

And beyond that, we're also seeing, you know, the RCEP and ASEAN countries. So are we going to see closer trade and investment relationship among these countries? Absolutely. I think that is the new trend that we have been seeing, right? And that is possibly the sort of the silver lining with all this chaos. Now, I would say, though, countries do take different stands at this point, it seems, when it comes to trade negotiation with the United States.

But nonetheless, whatever countries' response might be with Trump's tariff, one thing that is clear is they see that the United States has been a very unreliable trade partner, even if the trade negotiations may be successful. So for some of the countries, which I think for countries like Vietnam, it will be difficult

because they simply think that Vietnam is the back door for China's exports. So even if Vietnam is willing to drop the tariff rate to zero, it's still hard to perceive that Trump will let them off the hook.

I think that is a situation for many countries, even if they may be able to get some deal done. Still, this will shake on their confidence, their trust in the United States. And so what that means is that even if they can get some kind of reprieve at this point, they were still trying to diversify their trade partners.

they will still try to form an alternative system than engaging all in with the United States. So I think it's very likely that countries will try to form their own sort of alternative trading system for more resilient supply and trade and for more resilient trading system, trading partners.

That was Yan Liang, professor of economics at Willamette University. That's all the time for this edition of Road Today. I'm Gaena in Beijing. Thank you so much for listening. Bye for now.