In anticipation of a potential trade war between the US and China, President Xi Jinping has shown a new arsenal of measures in response to any trade threat. 
 
China showcased a new range of measures it is ready to employ if Trump follows through on his promise to impose tariffs on the world's second-largest economy. Beijing gave the world a sneak peek into its trade war objectives. 
 
This came after the Biden administration restricted China's access to critical components for artificial intelligence (AI) chips earlier this month. Xi restricted the shipment of many rare minerals with military uses and began an investigation into Nvidia days after the bans. 
 
Important parts required to construct drones have also seen reduced Chinese shipments to the United States and Europe. Beijing mimicked the actions of the us and EU by expanding its export control regime to cover all businesses. Not just those in China but also banning businesses outside its border from the sale of certain items to the US.

The retaliation seems to be carefully timed so it could scare the US without causing a rift in the already delicate bilateral relationship, this was done to avoid any significant economic impact on China. After previous restrictions, exports of the impacted metals to the United States essentially dried this year. 
 
Chinese businesses are already making moves to source chips domestically, so most of the swipes appeared to be symbolic.

Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong, said, "The Chinese government is essentially creating bargaining chips against the US, especially with the anti-trust probe of Nvidia," 
 
Beddor added, "It doesn't mean they're going use those chips just yet, but they're preparing for negotiations."

(With inputs from the agencies)

In anticipation of a potential trade war between the US and China, President Xi Jinping has shown a new arsenal of measures in response to any trade threat. China showcased a new range of measures it is ready to employ if Trump follows through on his promise to impose tariffs on the world's second-largest economy.

In anticipation of a potential trade war between the US and China, President Xi Jinping has shown a new arsenal of measures in response to any trade threat. China showcased a new range of measures it is ready to employ if Trump follows through on his promise to impose tariffs on the world's second-largest economy. Beijing gave the world a sneak peek into its trade war objectives. This came after the Biden administration restricted China's access to critical components for artificial intelligence (AI) chips earlier this month. Xi restricted the shipment of many rare minerals with military uses and began an investigation into Nvidia days after the bans. Important parts required to construct drones have also seen reduced Chinese shipments to the United States and Europe. Beijing mimicked the actions of the us and EU by expanding its export control regime to cover all businesses. Not just those in China but also banning businesses outside its border from the sale of certain items to the US. The retaliation seems to be carefully timed so it could scare the US without causing a rift in the already delicate bilateral relationship, this was done to avoid any significant economic impact on China. After previous restrictions, exports of the impacted metals to the United States essentially dried this year. Chinese businesses are already making moves to source chips domestically, so most of the swipes appeared to be symbolic. Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong, said, "The Chinese government is essentially creating bargaining chips against the US, especially with the anti-trust probe of Nvidia," Beddor added, "It doesn't mean they're going use those chips just yet, but they're preparing for negotiations." (With inputs from the agencies)

China gets a head start on a looming trade war with the US

South Korean exports snapped a 14-month losing streak in February thanks to more working days this year compared to last, although evidence of disruptions from the coronavirus were reflected outside the headline figures.

South Korea's monthly trade data, the first to be released among major exporting economies, provides an early guide to the health of global trade already taking a hit from the epidemic.

Overall shipments in February rose 4.5% year-on-year, trade ministry data showed on Sunday, beating a median forecast of a 3.4% rise, given 3.5 more working days from a year earlier. This compares with a 6.3% decline in January due to the Lunar New Year, a holiday which fell in February last year.

Average exports per working day, however, tumbled 11.7%, the steepest decline in three months, and a big swing from a 4.6% increase in January.

Exports to China dropped 6.6% from a year earlier, after falling 3.7% for the Feb. 1-20 period, but average exports to China per working day plunged 21.1%, the ministry said.

This follows data on Saturday that showed factory activity in China contracted at its fastest ever in February, even worse than during the global financial crisis of 2008.

"Per-day exports were seen subdued especially in the second half of February," said Lee Sang-jae, chief economist at Eugene Investment &amp; Securities, noting that it's not over.

"If the decline in February was mainly driven by sapping Chinese demand, exports would fall even worse in March and April as negative perceptions over Made-in-Korea products spread," he said.

But a rise in chip demand and prices, and increased sales to other countries including the United States, were expected to partially negate impact from the coronavirus.

A breakdown of the South Korea trade data showed February's overseas sales of memory chips and car components rose 9.4% and 10.0%, respectively, from a year earlier.

Worse to come

South Korea on Sunday reported 376 new infections, raising its tally to more than 3,500, the highest outside China. On Saturday, South Korea recorded its biggest daily jump in cases so far.

"Economic impact from the spread of the coronavirus is expected to be greater than in SARS," said Sung Yoon-mo, the South Korean industry minister, adding that he expects further economic consequence in March.

Economists are also concerned over whether temporary factory shutdowns at major companies will further weigh on Asia's fourth-largest economy.

"Worse is yet to come if major exporting companies start shutting down their factories temporarily in the wake of the spike in domestic infections," Meritz Securities' chief economist, Lee Seung-hoon, said.

Hyundai Motor Co suspended operations at one of its factories after a worker tested positive for the virus, and LG Display has shut a display module plant for disinfection work until Tuesday.

A survey from the central bank showed business sentiment suffered its worst fall in nearly 17 years, even before the spike in national infections.

Global investment banks now see South Korea's economy grew at a slower pace than last year's 2.0%.

Last week, the Bank of Korea kept interest rates unchanged, while raising the ceiling for its special loans programme to 30 trillion won ($25 billion) to extend support for sectors hit by the virus.

The finance ministry said on Friday a supplementary budget due next week to cushion the economic hit of the coronavirus will be larger than the 11.6 trillion won package spent during the 2015 MERS outbreak.

South Korean exports snapped a 14-month losing streak in February thanks to more working days this year compared to last, although evidence of disruptions from the coronavirus were reflected outside the headline figures.

South Korean exports snapped a 14-month losing streak in February thanks to more working days this year compared to last, although evidence of disruptions from the coronavirus were reflected outside the headline figures. South Korea's monthly trade data, the first to be released among major exporting economies, provides an early guide to the health of global trade already taking a hit from the epidemic. Overall shipments in February rose 4.5% year-on-year, trade ministry data showed on Sunday, beating a median forecast of a 3.4% rise, given 3.5 more working days from a year earlier. This compares with a 6.3% decline in January due to the Lunar New Year, a holiday which fell in February last year. Average exports per working day, however, tumbled 11.7%, the steepest decline in three months, and a big swing from a 4.6% increase in January. Exports to China dropped 6.6% from a year earlier, after falling 3.7% for the Feb. 1-20 period, but average exports to China per working day plunged 21.1%, the ministry said. This follows data on Saturday that showed factory activity in China contracted at its fastest ever in February, even worse than during the global financial crisis of 2008. "Per-day exports were seen subdued especially in the second half of February," said Lee Sang-jae, chief economist at Eugene Investment & Securities, noting that it's not over. "If the decline in February was mainly driven by sapping Chinese demand, exports would fall even worse in March and April as negative perceptions over Made-in-Korea products spread," he said. But a rise in chip demand and prices, and increased sales to other countries including the United States, were expected to partially negate impact from the coronavirus. A breakdown of the South Korea trade data showed February's overseas sales of memory chips and car components rose 9.4% and 10.0%, respectively, from a year earlier. Worse to come South Korea on Sunday reported 376 new infections, raising its tally to more than 3,500, the highest outside China. On Saturday, South Korea recorded its biggest daily jump in cases so far. "Economic impact from the spread of the coronavirus is expected to be greater than in SARS," said Sung Yoon-mo, the South Korean industry minister, adding that he expects further economic consequence in March. Economists are also concerned over whether temporary factory shutdowns at major companies will further weigh on Asia's fourth-largest economy. "Worse is yet to come if major exporting companies start shutting down their factories temporarily in the wake of the spike in domestic infections," Meritz Securities' chief economist, Lee Seung-hoon, said. Hyundai Motor Co suspended operations at one of its factories after a worker tested positive for the virus, and LG Display has shut a display module plant for disinfection work until Tuesday. A survey from the central bank showed business sentiment suffered its worst fall in nearly 17 years, even before the spike in national infections. Global investment banks now see South Korea's economy grew at a slower pace than last year's 2.0%. Last week, the Bank of Korea kept interest rates unchanged, while raising the ceiling for its special loans programme to 30 trillion won ($25 billion) to extend support for sectors hit by the virus. The finance ministry said on Friday a supplementary budget due next week to cushion the economic hit of the coronavirus will be larger than the 11.6 trillion won package spent during the 2015 MERS outbreak.

Coronavirus weighs on South Korea February trade; ministry says worse to come

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China gets a head start on a looming trade war with the US

Coronavirus weighs on South Korea February trade; ministry says worse to come