JimRogersWorld-renownedinvestorJimRogershassaidthatheisnotinfavorofthedecisionofU.S.PresidentDonaldTrumptoraisetariffsonChinesegoods,andhasappealedtobothsidestostopthetradewar.
TheUnitedStatesimposedextratariffsonanother$16billionworthofChinesegoodsfromAugust23.ThisfollowsthemovebytheTrumpadministrationtoimposeadditionaltariffson$34billionofChineseproductsstartingonJuly6.
Inatit-for-tatresponse,ChinaimposedtariffsonthesameamountofU.S.products,takingeffectatthesametimeastheU.S.measures.
Describinghowthebusinesssectorwouldbeaffected,Rogerssaid:“Theonessubjecttotariffsarealreadyseeingpricehikesandslowerbusiness;butthisisjuststarting.Higherprices,lessdemand[areinevitable]atleastpartlybecauseofuncertainty.”
ToforceChinatobowtoU.S.tradeaggression,theTrumpadministrationaddedtothetensionsbythreateningtoimposea25-percenttariffonanadditional$200billionworthofChineseimports.
Rogers,a75-year-oldAmericanbusinessmanandco-founderoftheQuantumFund,describedTrumpasaseriousprotectionist,addingthat“Thereisnoevidencethatanytradewarhaseversucceeded.”
Despitetradefrictions,China’sforeigntradesurgedby12.5percentinJuly,comparedwiththe4.3-percentincreaseinJune,withexportsgrowing6percentandimportssurging20.9percent,accordingtoChina’sGeneralAdministrationofCustoms.Inparticular,China’sexportstotheU.S.rose5.6percentyearonyearandChina’simportsfromtheU.S.grewby4.3percent.
InJuly,importsfromRussia,CanadaandVietNamjumped25.7percent,25.8percentand28.2percentrespectively,suggestingthatChinaistryingtofindalternativesourcesforimportstocopewiththefalloutfromthetradewar.
EscalationofthespatbetweentheUnitedStatesandChinahasalsoimpactedstockmarketsonbothsides.
“Themarketisdownalot,butsowhat?Thishappensallthetimeinmarkets,”Rogerssaid,addingthatinhisopiniontheChinesestockmarketwouldreboundwhentheU.S.marketrallies.
TheproblemswiththeChinesestockmarketaretheresultofmorethanjustthetradewar.China’stopsecuritiesregulatorhasrecentlybeenmakingmovestoseekmorestability.OnAugust8,theChinaSecuritiesRegulatoryCommissionreleasedastatementsayingthattheauthoritieswouldcontinuetodeepenreformofthelistingsystemandpromotemergersandacquisitionsoflistedcompanies.China’ssharepricesreboundedthenextday.
RogershaslongbeenoptimisticaboutChina’seconomyandnationalstrengthandinhisownwordshehasyettoseeanythingthatmakeshimdoubthisfaithinChina.“Whathashappenedinlastfivemonthsthatissomomentousastomakemechangemymind?”heasked.
RogershasvisitedChinaasatouristmanytimessince1984,includingonamotorcycletourin1988.Duringthattime,herealizedthatChinawouldbethenextgreateconomyandbegantomakefinancialinvestmentsinthecountry’smarketsduringthelate1990s.
HeevenmovedhisfamilyfromtheUnitedStatestoSingaporetoprovidehisdaughterswithaccesstoaChineseenvironment.Now,heisverybullishabouttheChineseagriculturesector.
TheChinesewordweiji—normallytranslatedas“crisis”—isoneofhisfavorites.Heunderstandsthat,inChinese,itimpliesthatdisasterandopportunityarethesamething.So,forthecurrenttensionsbetweentheworld’stwobiggesteconomies,heoffersthissuggestion:“Beworried.Getprepared.Andstopthetradewar.”
ThearticlewasfirstpublishedonChina.org.cnCopyeditedbyLaurenceCoultonCommentsto