Open to talk, ready to hit: China imposes 84% tariffs on U.S. goods
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China lays out its official stance on trade with the U.S. in a newly released white paper. Meanwhile, Beijing and Brussels stand together in defense of free and open trade. And trust in America is faltering. A new survey shows a sharp jump in the number of Britons who believe the U.S. is using its global power for bad.

Welcome to Road Today, a news program with a different perspective. I'm Ge'Anna in Beijing. To listen to this episode again or to catch up on previous episodes, you can download our podcast by searching Road Today.

China is speaking out against growing unilateralism and protectionism from the United States, warning that these actions are putting a strain on their economic ties. In a newly released white paper, Beijing says China has fulfilled the terms of a phase one trade agreement signed in January 2020 with the United States, but Washington has violated its obligations under the deal.

The document makes it clear China remains committed to free trade and the rules of the World Trade Organization. It also notes that Beijing and Washington can resolve differences through dialogue and scoring mutual benefit and win-win cooperation at the essential nature of bilateral trade.

So for more on the latest development of China-U.S. ties, let's have Professor Liu Baocheng, Director of the Center for International Business Ethics, University of International Business and Economics, and Andy Mock, Senior Research Fellow at the Center for China and Globalization. Thanks for joining us, gentlemen. Great to be with you, Anna.

Let's start with the basics here. The release of a white paper comes at a time of heightened tensions and a complex international economic landscape. Professor Liu, what core message does China aim to convey both domestically and internationally through its publication?

China is employing the basic common sense and also the proven effective economic theory to tell the United States and also to share with the rest of the world that the trade war serves no good to any partners. And it also reminds that the U.S. history of the tariff that brings China

about the depression and other type of disasters. And then China is highly committed to its commit obligation of WTO and also the first phase agreement signed in with the United States. And now

the U.S. is there to send a tornado to the whole world against the basic notion of free and fair trade with the so-called reciprocal tariffs.

But in the end, it's going to hurt the United States, definitely. And China also wanted to call on the whole world to stand up against the United States in this type of a lunatic stacking on the tariff.

Andy, what's your take? What message do you think China is aiming to send out at this moment? Well, I think China's message is very clear. The problem, though, I think, and this may sound very pessimistic, is that whatever China says, and China is the most powerful country in the world, I think, when it comes to speaking to the United States about global trade. But I think even China,

will be, again, I say this with a spirit of pessimism, will be ignored by the United States. And here's why. I think that it is not wrong to call what the U.S. is doing, taking unilateral action, to call it a kind of an economic aggression. I think that is correct. But I think that is to miss an important point, which is why is the U.S. doing this?

this. And it is not doing this solely to attack China, although that certainly is part of the fallout. But I think the U.S., President Trump certainly recognizes that the U.S. is facing three catastrophic domestic problems. The

The first is the budget deficit, which is getting larger and larger. We're assuming interest payments alone will consume all of government revenue. So that's problem number one. Problem number two is a bloated and sclerotic public sector.

public sector. So the public sector in the United States has long been recognized as not that efficient. The tax system is not only burdensome, but distortionary for individuals and companies. And finally, the U.S. has long been losing its industrial capacity.

So all of these are domestic issues that really have nothing to do with China. Now, that being said, China, of course, is being blamed for this. But at the same time, and this is not just President Trump's talking points.

But many, many credible analysts and experts for many years have been saying these are existential problems facing the United States, especially the budget deficit and the increasing government debt, the increasing and increasingly unsustainable government debt.

And the U.S., President Trump in particular, has seen this as his mission, his calling, that he must do something like this. And this global tariff onslaught is seen as kind of a sword that will cut the Gordian knot, this very intertwined knot of the budget deficit, the bloated public sector, and an eroding industrial base.

Now, the problem with this is, of course, is that it's very likely that this will fail and not only fail, it will hurt the United States. But of course, it is causing tremendous collateral damage all around the world. And this is, again, why I say that what China says might not

have that much of an influence. Because again, I think the U.S. sees this really as the means to address these three interrelated existential domestic problems. And debuting on your analysis, there is an intriguing idea. And when it comes to U.S. tariffs war against China, some experts argue that the current situation resembles a contest of endurance.

They call a game of who can bear more pain. Do you agree with this framing? And has the U.S. fully considered the damage these actions may cause to its own economy and its people? Or is it overplaying its hand in this worldwide trade war?

Well, I think Anna looked at narrowly. I think there is a contest of wills here, although I see it somewhat differently. You know, if we look at President Trump's words very carefully,

I think what he is saying is that he still, at least perhaps implicitly and subconsciously, sees the United States still as the global hegemon that can punish any country that would dare to challenge its authority. So, you know, the words that he uses, you know, China has dared to retaliate as if these two countries were not equals.

So I think this is the problem. And unfortunately, the reality is that in many ways, so in purchasing power parity terms, China's economy already is much, much larger than the United States. If we look at it from a strategic perspective, I think people like Scott Bessett, the Treasury Secretary, says that the deficit country has more power because they are the buyer. But I think either he is deliberately misleading China

his audience by saying this or he might not completely understand that in fact the us is very very reliant on china for a number of crucial goods and in this way i think that if it does come down to who can stand the most pain i think china is in the stronger position but if

But if we look at it more broadly, this might not matter. Because, again, if the United States sees these three problems as not only existential but urgent, they must be solved now. And again, President Trump uses this term, the U.S. is a sick patient. And this is high risk, dangerous surgery that must be done.

And if that is true, and it doesn't really have to be true, but if President Trump, his administration believes this is true, there really is not too much other countries can do to change the US's force of action. So that's the pessimistic side of this. The optimistic side, Anna, is that China, especially President Xi, has talked about for many years changes unseen in a century.

And I think a big part of this is recognizing these longer term trends, these problems the US is facing, the budget deficit, the rising debt, a bloated, sporadic public sector, the erosion of the industrial base. These did not happen overnight. These problems have been accumulating, becoming more acute for literally decades. And I think because of this, China has planned, prepared

for these eventualities. So I think whether or not a more, I don't know, amicable, perhaps is the word amicable, resolution between the US-China tensions can be reached, I think what's going to happen is the rest of the world is going to continue trading, continuing opening up with capital flows, product flows, service flows, even labor flows.

And the U.S. may end up very, very isolated. And I've been saying this for years, Anna, that we can see these trends, that if the U.S. continues on this path, it's going to end up isolated not only geographically, right, separated by two enormous oceans, but it's going to be isolated economically, perhaps even diplomatically.

That's very insightful. Professor Liu, do you share the same stance? Do you think the United States has fully considered the damage these actions may cause to its own economy and people? And what preparations has China made to withstand the pressures brought by these escalating tariffs today? I think the United States is fully aware of the problem and it has really pointed out that

But the problem is that what is the recipe to cure this problem? And Donald Trump is really rushing against time and he wanted to fix everything overnight because, you know, he doesn't have a long term to serve.

But on the China side, we have strategic patience. We have 5000 years history and we didn't even trade with the rest of the world for thousands of years. And Chinese people survived and prospered.

we remain the top largest population. So the fact is that both sides need really to look at their own constituencies, their own people, and how that's going to benefit or damage the basic interest of the people. Now, look at the...

the economic structure. China and the US is really highly complementary in that regard. It's like, you know, Beijing versus the rural areas. Yes, you are really showing a deficit because we consume in Beijing, for example, a lot of groceries supplied by the rural area. You can say, well, I'm suffering a deficit with Hebei province.

But you have other means to specialize and also to exercise your own comparative advantage through the basic division of labor. He's not really aware of such sort of issue and simply blame other countries. And he thinks that every dollar U.S. pays for their own necessities is doing a favor to the rest of the world. So this type of hypostasize really lead to such a situation.

And also now, if you see the reciprocal tariff, that's really based on the assumption. So they are charging even those countries from which they enjoy a trade surplus and even charge penguins for such a sort of tariff rate. And so this indiscriminative type of tariff war

is really igniting a lot of the controversies over the world. And of course, there are different choices among the world, depending on their understanding of the situation. But China is now being pushed back to the war, and we have no other means but to really to fight back. And

And another issue that cannot be ignored is the difference in culture. Chinese people definitely have a higher level of tolerance zone so that we are able to team up with the government decision. And look at now the U.S. when people are getting more and more pinched

they in terms of their life expenditures and daily supply, they come up and protest. And then, you know, the every senator and every House of House reps, they are also consumers within the United States. And they really wanted to voice, you know, where's the basic rationality and basic common sense.

Professor, breaking news just announced China is imposing additional 50% levy on American goods entering the country, comes on top of an earlier rate of 34%, bringing the total import duty to 84%. What's your take on China's latest countermeasure just announced? What does it signify? Well, this is really a diplomatic and political gesture, but I would

I rather see that China really have a deep breath. And it's like people sitting around the dinner table. One guy is getting drunk and then we need to keep the tables stable. The other can really get crazy for a period of time. And also because China believes and also the whole world is condemning the United States using tariffs to hurt themselves. Eventually it's going to backfire, whether positively or the

Passively, any type of extreme tariffs can really hurt your own people and can hurt your own industry.

We need really to think more technically as how we can really pinch the Trump with more precision. And in the meanwhile, we need also to take care of our own business community and also our own consumer needs. Andy, what's your take? What do you think of China's newly announced countermeasures to impose another 50% duty on U.S. goods? That's 84% in total. What are the implications?

Well, I'm not surprised because, again, I think China has been very clear that it will deal with every country, including the United States, on a basis of mutual respect.

and that it will not be bullied. So when we look in the past, what China has done, it has calibrated its responses to not escalate, but at the same time to demonstrate its resolve. So I think this tit-for-tat matching of tariffs is completely expected.

But also, China is responding with asymmetric measures as well. So if you're watching the US dollar RMB exchange rate, you've noticed, I'm sure, that we've breached the 7.20 benchmark. So the RMB, I think, is being managed to offset the tariff. So this is one asymmetric measure.

The second asymmetric measure that not too many people are paying attention to is the advances being made by the digital yuan or the digital RMB, a central bank digital currency. My personal view is that China has long been prepared to roll this out, but has held back to avoid antagonizing the United States.

And now with these measures, and I think the conclusion that perhaps the Chinese government has reached is that the U.S.,

behavior cannot be shaped by holding out an olive branch and that the only perhaps rational force for China is to present itself as strong and unyielding. And what this means for the digital yuan is that it is rolling out now an alternative that is something like 95 percent cheaper

than the existing Western-based system for transferring funds across border, especially for trade settlement. That can be settled in seconds. And what this means, again, is this could undermine dollar hegemony. And I think this is, again, something China has held back in the past because they did not want to antagonize the U.S., but now because of these actions. But again, the U.S. is taking, I think, not practical,

primarily to attack China, but because it feels it must solve its domestic problems. And as a side result is attacking China. Now that China feels, OK, China has to show its own strength. And part of that is through these asymmetric measures, including accelerated rollout of the digital RMB.

And let's look at how other Asia-Pacific countries are reacting. Some smaller economies like Vietnam, which is among the hardest hit by the U.S. trade actions, have offered a tariff concession to the U.S. under pressure. But the White House trade and manufacturing advisor Peter Navarro said...

Such offers are not enough to warrant lifting U.S. tariffs. What does this reveal about Washington's broader trade strategy and political motivation? Is this about trade imbalances or something deeper? Well,

Well, you know, my understanding of what Peter Navarro is saying here is that the barriers to free trade or what the U.S. would consider fair trade, especially with regard to Vietnam, is that the official tariff rates are certainly one piece. But according to Peter Navarro, they're actually not the most important piece. It's the non-tariff barriers. So, for example, phytosanitary equipment.

measures, that value added taxes, other non-tariff barriers are far more important. So the administration, at least, and again, there seems to be two camps here. So there's the Elon Musk camp that wants to see zero tariffs. There is the Peter Navarro camp that is very, you know, to put it maybe more diplomatically, very strong on, quote,

quote-unquote fair trade and sees tariff rates really as less important. And, you know, Japan has often used an example of this too, that Japan has these

formidable non-tariff barriers that keeps American cars, American agricultural products from fair access. So whether that's true or not, I think takes trade experts to credibly debate. But at least this is what

Navarro is saying that, you know, the tariff rate really doesn't matter. So Vietnam could offer zero tariff, a zero tariff rate to the U.S., but that really is not a very meaningful concession, according to the administration, as channeled by Peter Navarro. Hmm.

Professor Liu, in dealing with U.S. trade coercion, Singapore's foreign minister said recently that U.S. tariffs may end up pushing more countries toward China, further strengthening China's role in global trade. What's your view on that? I think that makes a lot of sense because the first, capital is like water. It will go to the lower land which can accommodate them.

And China, on one hand, is getting more and more antagonistic against the U.S. And in the other hand, China is there to assure to the world that we're going to further open up the Chinese market. We are not only dealing with lowering of the

tariff, but also we are doing a lot more at home to unify the Chinese market with common standard to implement better of the rule of law, not to mention the rising buying power from the Chinese middle class. And this is something that's in big contrast with the United States. And so the global investors are

are really there to make very sensible decisions and where they can really stay put longer with a high level of certainty, which is China. Thanks, gentlemen. This is Road Today. We'll be back.

Welcome back to Road Today with me, Ge'enna, in Beijing. As global trade faces rising headwinds from inflation and geopolitical tensions to a surge of aggressive tariff policies, China and the European Union are sending a clear message. Multilateralism matters and dialogue must continue.

Just this Tuesday, Chinese Premier Li Qiang and European Commission President Ursula von der Leyen held a phone conversation emphasizing the need to safeguard free and open trade, strengthen China-EU cooperation, and push back against what Premier Li described as economic bullying from unilateral U.S. tariffs.

So to help us unpack the strategic implications of this conversation, we are joined by Dr. Li Lun, Assistant Professor of Economics at Peking University School of Economics. Thanks for joining us, Professor. Thanks for having me.

The two leaders said both the EU and China are committed to upholding fair and free multilateral trading system with the WTO at its core advocate for economic globalization. How do you interpret the timing and tone of their message to the world? Yeah, so I think the message comes really at a very critical moment.

As you know, the United States have just announced an additional 50% tariff on all Chinese goods, which brings the total rate to 104%. Also, it imposes additional tariffs on all of its trading partners, including Mexico, Canada, the European Union, and Japan, and so on. So these actions, as Premier Li Qiang said, reflect a very clear signal of unilateralism and protectionism

that really put a heavy pressure on the global trade and economic stability around the world. So I think the phone call from Premier Li Qiang to President von der Leyen sends a very strong signal, which is a signal of unity, basically reinforcing that the two regions having a strong commitment to a multilateral trading system that is centered around the CEO.

So I think both leaders through the phone call, they stress the importance of open dialogue and cooperation in a time when the global economic environment is under a lot of uncertainty.

I mean, they pointed out a lot of directions for collaboration, including the upcoming 50th anniversary of China-EU diplomatic relations and also high level dialogues in many areas. So these can be very helpful for the two

between the two regions. Professor, speaking of that, both leaders emphasize the need to preserve the global industrial and supply chains, as well as the urgency of launching a new round of China-EU high-level dialogue in areas like grain development and digital cooperation. What role can this high-level China-EU dialogue play in reinforcing the global trading system, especially in sectors like grain energy and digital transformation?

Yeah, so Premier Li Qiang has also mentioned that in his phone call that there's an urgency. Basically, we should launch a new round of high-level talks that focus on a number of areas, including green development and digital cooperation as soon as possible between China and EU. So I think in these...

fields that are fast evolving, China and EU can have a lot to learn from each other, whether by exchanging their knowledge or expertise, or they can set joint standards in these green energy development. Also, they can collaborate on more research and development and innovation. So there are lots of work to be done. So overall, I think these high level talks can open up more opportunity for deeper collaboration

between the two regions, whether it's trade relationships, whether it's research and development. Also, it can attract more foreign investment in both regions. Overall, it can, you know,

I believe it can enhance the well-being and living standards of both citizens in both regions. Then to what extent do you think the EU and China can work together to hedge against the destabilizing effects of U.S. indiscriminate tariffs, especially for smaller and developing economies today?

Yeah, that's a great question. So we have to understand the magnitude of China and EU compared with US. So taken together, China and EU accounts for over 30% of global exports and around 25% of global imports.

So these numbers are well above the US's share in international trade. So as long as this important relationship between China and EU is stabilized, I think first we can know that for EU member states,

the smaller countries within EU having this consistent and stable relationship with China is beneficial for them. But besides country within EU, I think the stability of this relationship is also helpful for the economic health for other European and Asian countries, especially when we think about EU and China, they have like a direct

connectivity through land, right? There are fewer natural barriers between the two regions. So with current initiatives such as the Belt and Road Initiative, also the China-Europe Railway Express, both regions can actually strengthen their supply chain and expand their market access in this very important period of time, and also being able to benefit all the Asian and Eastern European countries along these trading routes.

So overall, I think these are the ways that China and the EU can offer these smaller and developing countries a vital supply chain and a more consistent and reliant trading network against the unpredictability caused by these US tariffs.

We know the European Union has been talking about its strategic autonomy. As U.S. tariffs on EU exports escalate, how might the EU balance its strategic autonomy with its economic ties with Washington? Are we seeing signs of a more independent European trade posture today?

Yeah, so I don't know if you noticed, but on April 7th, President von der Leyen hold a press briefing in Brussels. So she said a lot about the, you know, the terror policy of US, but the overall message that I sense is that the EU is ready to basically hope for the best, but also prepare for the worst. She mentioned that, you know, the terrorists

bring immense costs both to US consumers and businesses, but also bring massive impact on the global economy. So what EU is ready to do is that first they're willing to negotiate as she's proposing a zero for zero trade deal for industrial goods between EU and US, but they're not afraid because they're also prepared to respond if necessary with countermeasures and also ways to defend its interests.

She mentioned that there are two pillars of its strategy. The first one is to basically strengthening the single markets within the EU and get rid of any remaining trade barriers within EU. And the other pillar, which I think is the more interesting, is that she mentioned she wants to diversify the trade relations. And I quote, "We will focus like a laser beam on the 83% of global trade that is beyond the United States."

So that sends a very clear signal that the EU is taking a very strong stance against the US and in the long term is ready to become more independent if necessary, both economically and also diplomatically.

Professor, from Chinese perspective, Premier Li Qiang also spoke about China's confidence in its economic resilience and readiness to expand openness. What signal, in your opinion, is China sending to the EU and global investors through this message?

So currently we're living through an environment where these tariffs are basically reshuffling supply chains and really unsettling these investors globally. We're seeing very poor performance of the Dow Jones index and also financial markets across the globe.

So Premier Li's emphasis on China's resilience and also its stance on openness is a very clear signal to both EU investors and global investors that China is an environment where we can provide the stability and consistency that U.S. is currently seeking.

China is always pledging of, you know, keeping the openness ongoing and, you know, pushing the market reforms also like by, you know, strengthening the China-EU, you know,

relationships, it's basically injecting more confidence and optimism to investors. And hopefully, through these signals, we can attract more foreign investment, we can build more confidence in our own stock market and financial markets as well. Thanks, Professor, for your insightful analysis. That was Dr. Li Luen, Assistant Professor of Economics at Peking University School of Economics.

So let's move to our next topic. Is this so-called special relationship between the United States and the UK starting to lose its shine? A new Ipsos survey says only 3 in 10 Britons still believe that bond exists.

a sharp drop from just a year ago. Even more striking, 41% of people in the UK now think the US is using its global power for bad. That's more than double the number who felt that way last year. And when it comes to tariffs, people from the UK aren't feeling optimistic either.

About two-thirds expect U.S. tariffs to hurt not just the U.K., but the global economy. And more than 70% say those tariffs will hit them where it hurts the most, in their wallets, with higher prices on everyday items. So to discuss this trend, joining us in the studio is my colleague Zhao Ying. Welcome. Thank you. Thank you.

First of all, when we talk about the special relationship between the UK and the United States, what does that really mean today? And why do you think so many Britons are now saying it doesn't exist anymore?

Well, the term "special relationship" has long been used to describe the close political, diplomatic, military and cultural ties between the UK and the US. It is coined by Winston Churchill when he delivered his historical address at Westminster College in 1946. He was suggesting a bond deeper than just shared interests, and a bond that's rooted in common values, mutual trust and strategic alignment.

Today, however, its meaning appears increasingly symbolic rather than substantive. And what we're seeing in this latest Ipsos polling is a significant erosion of belief in that concept. Like only 30% of Britons now say there's a special relationship in place, and that's down 17 points from last year. And this shift is driven by several interconnected factors.

For most, it's the widespread concern over US tariffs, with 66% of Britons anticipating a negative impact on the UK economy and 63% expecting harm to the bilateral relationship itself.

And these economic anxieties are compounded by a growing disapproval of U.S. leadership, with 63% believing President Donald Trump has mishandled the tariff situation. But also there is a cultural and emotional element because it's about how people feel about America. Many Britons grow up in America.

with a fondness for China, a fondness for the US, like its culture, its optimism, and its leadership role in the world. But now we're seeing that affection give way to cynicism and even frustration, and like people are canceling trips, boycotting US products, and openly questioning whether the US still shares Britain's values.

So while this phrase might still be used diplomatically on the ground, among the public, it feels increasingly outdated. And for many, it's less a reflection of reality and more of a relic of another time. We see that more and more people in the UK are saying the United States is using its global power for bad rather than for good. What's driving that shift in perception, in your opinion?

Well, I think there's disillusionment with America's foreign policy decisions because over the last several years, and especially under Donald Trump, the U.S. is obviously retreating from its global leadership role, especially if you look at how it is questioning NATO, pulling out of multilateral agreements.

embracing protectionism and often treating allies like adversaries. So all of that sends a message to its allies that America is no longer interested in being a collaborative global leader, but rather a solo power that's willing to act without warning or consultation. Is this just a British reaction or are we seeing similar attitudes across the rest of Europe too?

Well, this isn't just a British phenomenon because we are obviously seeing a broader shift in attitudes towards the U.S. For instance, YouGov's Eurotrack survey indicates favorability toward the U.S. has fallen sharply since Trump's re-election, with Denmark at 20%.

Sweden at 29%, Germany at 32%, and France 34%. All historic lows in some cases. And Italy and Spain at 42% and 43% retain slightly more positive views, yet still reflect a decline. And the risen mirror what we're seeing in the UK, but each country adds its own lens, like in Denmark, for instance,

Trump's remarks about seizing Greenland have obviously fueled a 20-point drop in U.S. favorability. And in Germany, the public has been particularly rattled by American unpredictability on defense and trade. And even under Biden, some Germans already felt the U.S. is too willing to make decisions unilaterally, like if you look at the withdrawal from Afghanistan, where European allies felt sidelined.

And in France, the skepticism runs even deeper because there's this longstanding view, especially among French elites, that Europe needs to be more strategically autonomous and less reliant on the U.S. for its defense and foreign policy direction. And that thinking gained momentum after the AUKUS attack

submarine deal when France was cut out of this defense pact involving the US, UK, Australia. So this all suggests a continent-wide cooling of trust, not just in Donald Trump, but in America's role as a dependable partner. Then building on that trend with all this frustration, especially around tariffs, is there growing support in the UK or Europe to hit back with the retaliatory tariffs of their own?

Well, this discontent with U.S. policies has indeed translated into significant support for retaliatory measures across Britain and Europe. In Britain, the Ipsos survey indicates that 44% of the public favors retaliatory tariffs on U.S. goods,

if a trade deal cannot be secured, although 51% prefer pursuing an agreement to reduce trade barriers. And across Europe, the EuroTrack survey reveals even stronger sentiment. Support for retaliatory tariffs ranges from 56% in Italy to 79% in Denmark, with Britain at 71%, Germany and France at 68%, and Sweden at 62%.

And the European Union has pledged a robust and calibrated response, with trade ministers nearing an agreement on targeting U.S. goods like bourbon and motorcycles set to begin on April 15th.

And Britain, while it currently favors negotiation, but it has already prepared a 417-page list of U.S. products for possible tariffs if talks fail by May 1. So such state-for-tax matters could spiral, raising costs, disrupting supply chains, and risking a global trade war, particularly if the U.S., as Trump has threatened, counters with further levies.

Then do you think these opinions might change again, you know, if there's a shift in U.S. leadership or has something more permanent broken in the relationship? Well, public opinion definitely can shift. Like when Barack Obama was elected in 2008, we

we saw a huge spike in global approval of the United States, especially across Europe. And the same went in reverse when Donald Trump took office. But also we need to understand that something deeper does seem to be changing because many people have started to question not just who was in the White House, but the stability and direction of the U.S. itself. The events of January 6th,

the deep political polarization in the US and America's growing inward focus have all contributed to this sense that the country is no longer the steady, reliable partner it once was. And also there is a generational shift happening.

Like younger Europeans grew up in a world where U.S. leadership has often associated with wars in Iraq and Afghanistan, surveillance scandals, and climate inaction. So for them, the special relationship or transatlantic bond doesn't carry the same emotional or historical weight it might have for older generations. And instead, there's more skepticism and a growing sense that Europe may need to rely more on itself.

Thanks, Zhao Ying, for your time and insights. Coming up, China moves swiftly to stabilize markets amid global financial turbulence. This is Road Today. Stay with us. History doesn't just echo, it warns. As Washington ramps up tariffs and the world braces for economic whiplash, are we watching a 21st century rerun of Herbert Hoover's Great Depression playbook?

From China's counter-strikes to cracks in America's economy, we unpack whether this trade war is strategy or self-sabotage. Get all these on this week's Chat Lounge, wherever you listen to podcasts, and on CGTN Radio.

You've been listening to Road Today. China has unveiled measures to stabilize the capital market and restore investor confidence. The move is in the wake of the global financial turbulence triggered by U.S. tariffs levied against Washington's trading partners.

Chinese state-owned capital firms have moved quickly to increase their holdings of domestic equities. The People's Bank of China also announced liquidity support through relending facilities on Tuesday. Central Huijin Investment once again increased its holdings of exchange-traded funds. The investment company said it would continue to do so to safeguard the stable operation of the capital market.

So for more on this, my colleague Zhao Yang spoke with Chen Jiahe, chief investment officer at Northern Arc Technologies. So Jiahe, the state-owned central Huijin investment announced it had increased its holdings of ETFs and pledged to continue buying, you know, to safeguard the market stability. So what are the ETFs and why did central Huijin choose them?

Well, basically, when we talk about ETFs, they are expressed in the terms of exchange trading funds. Basically, they're kind of index funds. They're kind of very large index funds, and you can buy that index fund in the markets

during the trading hour. I mean, unlike the Euro index fund, which you can only purchase when the market is closed. But ETFs is that you can keep on buying that during the trading hour fund. And that means if the Huijun buys ETF, it actually injects money into the

market directly at the time I made the purchase and because it is an index fund, it's a very easy operation for the central Huijin, which is the state-owned investment company of China because if they say, okay, we're going to buy 10 companies and your impact toward the market will

be limited. But if you buy ETFs, especially those ETFs covering a lot of stocks, for example, the Shanghai Shenzhen 300 index, that means if you buy one ETF, you inject liquidity into the market for these 300 companies altogether. And there are some also other ETFs that covers like 500 or even 800 stocks. So this basically means the central huijin is injecting liquidity into the market.

And tell us more about that. Is this a China stabilization fund?

Yeah, definitely. I mean, this central Huijin investment is performing like a stabilizing fund of China. I mean, it's not naming itself as a stabilizing fund and it has many other jobs as well for investments, global investment, all sorts of things. But it is also taking the role of stabilizing the market when the market is having some fluctuations like what we are having in recent trading days. And there's other

Other countries have this kind of fund.

Yeah, we have seen in many countries they have this kind of fund. I mean, not every country has it. I mean, for example, if you look at United States, I don't think the U.S. has it. U.S. is basically a kind of, you know, freelancing market that you can just do whatever you want and nobody is going to take care of you. I mean, if you make money in the market, you make money. You lose money, you lose money. I mean, remember in 1987, the S&P 500 index dropped by 27% in one single day without any really significant

without much accident happen at all. So no one was stabilizing that. But if you look at many other countries, especially where the governments are really taking a lot of responsibility, I mean, unlike what Trump is doing recently, is that, for example, if you look at China, if you look at Japan, yeah, we definitely got this kind of stabilizing fund. It's a common practice for governments that are really taking care of the economy.

And from what we've seen so far, the messaging and commitments, how determined is China in stabilizing the capital markets, do you think? Well, if you read through all the documents that the Chinese government has published in the past five or ten years, the Chinese government has consistently insisted that it will support the growing of China's capital market, which includes the equity market, the fixed income market.

the foreign exchange market, even the property market. I mean, we have been doing quite a lot of things for the property market in recent years. So China has kept on saying that we will safeguard the equity market, the whole capital market, including the equity market. And we have done a tremendous amount of job. I mean,

firm things like setting out a lot of legislation, setting up the government bodies, you know, also including this stabilizing activity from the central Huijin. It's so many jobs that China has been doing to stabilize its capital market. And what do you think are China's structural advantages in dealing with this kind of global economic turmoil brought about by the Trump administration's trade policies?

Well, there are many advantages China is having. I mean, that's why I'm still having 100 percent of my personal wealth in the stock market of China. I'm not worried at all. I mean, there are many things that support the long term growth of China. First of all, if you look at China's per capita GDP, we're trading at 13,000 USD. And if you look at the countries that are comparable to China, I mean, Japan, South Korea, Canada,

The average per capita GDP would be around 40 to 50 thousand US dollars So we've got a large room to grow and China has got a very good market I mean if you come over to China's market is stabilized is well regulated is transparent and the government is not intervene too much

in this market, companies are freely competing against each other. This market is very vivid. I mean, the growing of China is not because, well, not primarily or mainly because China's trading with the United States. I mean, U.S. has a population that is only 25% of China. I mean, trading with U.S. is not the main reason that's making China rich in the past 45

decades. But that's because China has been growing on its own. We've got our own market. I mean, currently China got 1.4 billion people. But if you look at United States, they've got 0.3 billion people. So that's a very small part of China, even less than 25 percent of China. So it's a lot of growth potential for China, not because China is doing trade with the U.S. Of course, the trade between China and the U.S. is important. But if you look at how much that's counting China's global trade, we don't really have much reasons to worry at all.

In terms of equity investments, JP Morgan and Citigroup analysts, when they upgraded their recommendations for China equities, one thing they cited was China's government support for the tech industry. So what do you make of that? And how do you view the role of tech and innovation in driving China's economic growth?

That's also another very important reason why China can withhold this pressure coming from the trade war that started by the United States. Even if the trade really goes to zero, China is not that much worried because this trade with the U.S. is counting about 3% of China's GDP. That's all. But the technology is increasing China's GDP by a tremendous amount. I mean, if you look at China's economic structure,

It has been shifting in the past five years from a heavy reliance on property and investment toward a heavy reliance on technology and innovation. This transferring has been very significant in the past five years, and it really increased the overall efficiency of China's economic operation.

It reduced China's pollution, reduced the labor cost, increased the efficiency. Everything is just going well in many industries of China. I mean, if you come over the industries, the consumption market, even the tourism market, nowadays you can employ a robot to carry you to the top of the mountain. I mean, all these things is really happening within every corner of China's economy. If you come to live in China, you can just feel that.

So this means this increase in the efficiency can withhold this pressure coming from the trade war. That's for sure. And let's talk about consumption, because one of the top priorities for the policymakers this year in China is to boost the consumption. So what's the outlook of that, do you think?

Well, the consumption is also one reason why China's economy is remaining stable. I mean, if you look at China's market, we've got 1.4 billion people. So that's why the consumption market of China itself is much more important compared with the trading between China and the United States.

So that's why China has been putting a lot of focus on increasing the consumption. We have seen that being working really well. I mean, currently, if you look at China's consumption, most parts of the consumption is remaining a solid growth at about 5% per year. And some markets are even going higher than that. So it's really supporting the growth of China from this large consumption market. And what do you think is the outlook of the global capital flow, especially under the current situation?

When we talk about the global capital flow, I think if I'm a global investor, I would look for countries beside the United States because the U.S. is behaving, you know, this current administration is behaving a bit crazy when they're talking about economic policies. This will destroy the trade between China and the U.S. They are talking about, you know, getting the profit from foreign holders.

the US Treasury that is held by foreign holders. So global traders is really worrying about the US market. That's why when you see the US stock market, it's been crashing in recent trading days. So they're looking for stable markets to put their money to. I mean, China is definitely one of the best

options in the global market. I mean, look at how stable we are here. Look at how consistent our government policies have been in the past one, two, three decades. We keep on doing the same thing as one to two decades ago we were doing. So this is a perfect market for global investors. That was Chen Jiahe, Chief Investment Officer at Novenart Technologies. That's all the time for this edition of Road Today. I'm Keanna in Beijing. Thank you so much for listening. Bye for now.

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