JOHANNESBURG - Chinese President Xi Jinping yesterday called on the developing world to rise against US protectionism, warning that the tariffs the world’s biggest economy had imposed on imports would have far-reaching implications for emerging nations and markets.
He told the 10th BRICS Summit in Johannesburg yesterday that the US stance had dealt a severe blow to multinational trading.
Xi said the developing world needed to take a united stance in rejecting the US president’s tariffs as no country would benefit from the measures.
“Today, we are witnessing major changes unfolding in our world, something unseen in a century,” said Xi.
Last month, the US and China embarked on a full-blown trade war with the Trump administration slapping tariffs on $500 billion (R6.5trln) in Chinese imports, forcing Beijing to implement retaliatory measures on US imports.
The stand-off has seen investors offloading emerging market bonds and sending currencies into a tailspin. South Africa has already raised the alarm, warning that the tariffs would result in major job losses in the steel, aluminium and auto industries.
President Cyril Ramaphosa described the measures as incompatible with the World Trade Organisation’s rules.
“We are worried about these measures as they affect developing nations,” he said.
South Africa is among developing countries affected by the US’s 25 percent tariff on steel and 10 percent on aluminium introduced in March, Ramaphosa said.
“Unilateralism and protectionism are mounting… dealing a severe blow to the multilateral trading regime. The international community has again reached a new crossroads.”
Xi said multilateralism must be upheld and urged all role players to observe international rules.
He said world trade needed to conducted on equal basis irrespective of the partner’s economic muscle.
“When new rules are made on… trade and intellectual property… we should make sure the views of emerging markets and developing nations are heeded.”
Brazilian Minister of External Relations Aloysio Nunes Ferreira characterised protectionism as among things taking the BRICS countries backward, saying: “They represent things that happened in World War II, for example on trade rules.”
He said the stability of trade rules and necessary support was important for all countries involved in trade.
Chinese Minister of Commerce Zhong Shan said contentious protectionism and trade war were some of the “key issues” they were working on.
“We will oppose any kind of unilateralism and protectionism,” he said, and called for trade relations between BRICS countries to be more pragmatic and institutionalised.
Trade and Industry Minister Rob Davies characterised the trade war as a full-frontal attack in which shots had already been fired.
Davies said 7 000 South Africans jobs in the affected industries were already on the line as a result of the tariffs.
Davies said unilateralism had a detrimental effect on trade patterns.
“All of us as governments have accepted that we are in support of a multilateral rules-based trading system… we don’t believe they should be undermined and weakened,” he said, adding that South Africa had become collateral damage in the trading war. “We are not party to the trading wars but many of us have been affected by the measures. We are very much non-combatants in this. Non-combatant collateral damage is where we find ourselves,” he said.
“We are seeing the shots being fired in the actual war. We are concerned about the post-war outcomes.”