China stepped up the trade war rhetoric on Tuesday, accusing the US of “deliberately destroying international order” with “unilateralism and protectionism”.
A day after Washington branded China a currency manipulator in a rapidly escalating trade dispute, China’s central bank said it “deeply regretted” the move by the US and said such behaviour “seriously undermined international rules” and damaged the global economy.
In a strongly worded editorial in the People’s Daily, the official newspaper of the Chinese Communist party, China accused the US of “deliberately destroying the international order” and holding its own citizens hostage.
Without mentioning Donald Trump or Washington’s accusations of currency manipulation, it said: “Today some in America are obsessed with American privilege to the point of destroying international rules and the international system … These Americans need to wake up!”
“The responsibility of big countries is to provide the world with stability and certainty while creating conditions and opportunities for the common development of all countries,” according to the editorial.
“But some people in the United States do just the opposite,” it said.
On Monday, the US labelled China a currency manipulator, in a move that brings already tense relations to a boil.
The US treasury secretary, Steven Mnuchin, accused China of manipulating its currency “to gain unfair competitive advantage in international trade”. The US will now ask the International Monetary Fund to “eliminate the unfair competitive advantage created by China’s latest actions”.
It is the first such move since 1994 and came as international stock markets fell on fears of an escalation in the simmering conflict between the two trading superpowers. The Dow Jones index lost close to 3% on Monday following similar falls in Asia and Europe.
On Tuesday, Asian markets fell. By the middle of the trading day Australia’s ASX200 had fallen 2%, the Hang Seng was down 0.7%, and the Nikkei 0.7%.
The move to designate China a currency manipulator fulfils Donald Trump’s election campaign promise: “China is intent on continuing to receive the hundreds of billions of dollars they have been taking from the US with unfair trade practices and currency manipulation. So one-sided, it should have been stopped many years ago!” he wrote on Twitter.