Hello and welcome to World Today, I'm Ding Hen in Beijing.
Coming up, Xi Jinping calls for absorbing netizens' opinion in terms of formulating China's next five-year plan.
Japan clinches a US$6.5 billion warship deal with Australia.
Kremlin plays down Donald Trump's nuclear rhetoric as U.S. envoy is to visit Moscow.
And the global rollercoaster ride of President Trump's tariffs has entered its new phase.
So is America really winning? To listen to this episode again or to catch up on our previous episodes, you can download our podcast by searching World Today.
First up, Chinese President Xi Jinping has called for studying and absorbing netizens' opinions in formulating the country's 15th Five-Year Plan.
The Chinese leader said the public has put forward many valuable opinions and suggestions for the plan.
He urged authorities at all levels to extensively hear people's opinions and views to meet their aspirations for a better life.
President Xi Jinping's instruction came after a month-long online campaign seeking public input for the 15th Five-Year Plan.
The campaign gathered more than 3.1 million suggestions between May 20 and June 20.
So for more, joining us now on the line is Professor Liu Baocheng from the University of International Business and Economics.
So thank you very much for joining us today, Professor Liu.
In China, formulating five-year plans is, I guess, in many ways, a top-level decision-making process.
So do you think it is possible to integrate this top-level design with seeking advices from the general public?
Yes, to many, the understanding is that China only the top boss or top field make decisions.
But the reality is the macro decision-making is a two-way traffic.
One is that they integrate the bottom level of understanding, expectation and concerns. through many other means, by survey, by collecting ideas.
Now they utilize the digital platform. So this really reflects the Communist Party's primary mission. that is there to serve the people.
In order to serve better of the people, you have to understand what is really on the mind of the people, what are the really daily concerns of those people. the top level decision making is there to integrate these ideas and make it more strategic level because individuals may not see a bigger picture so this is the uh what is termed traditionally as the democratic centralization system which falls to be rather practical in addressing the chinese culture in addressing the dynamic changes in the social consideration and in the educational level of the people and particularly was the digital advancement So this has been made possible.
And now that over three million suggestions are collected, that's a big project.
And it also shows that people are more informed and more enthused in participating in the government decision-making process.
And with such a collection, I hope then the government can also make it transparent.
What are those opinions? What are those suggestions? have been accepted or revised so that people will get a sense of reward in that way.
Because when you really see your idea or your efforts are really being taken seriously, then people can be more motivated to participate.
Now, with regard to this recent online campaign seeking public input for the 15th Five-Year Plan, President Xi Jinping said the campaign served as a vivid example of whole-process people's democracy.
Then, Professor Liu, what is your understanding of this idea, whole-process people's democracy?
Ideally, whole process people's democracy compares with the voting or representational democracy because this involves the entire process in the decision-making by collecting basic ideas, understanding people's basic consideration, and put it into the policy formulation and discussion process, and then translate them into implementation, and after which there is really a supervision of work that is still participated by people.
So instead of a one time, you know, the voting gala, this is there to have more of involvement in the entire process.
And it also refers to dynamic changes when people have different ideas and when external and domestic situation changes quite substantially.
So in essence, it ensures that people are involved in every stage from agenda setting to policy evaluation and to make sure that governance remains anchored in people's needs and expectation.
So such sort of public consultation is being used in the next five-year plan is quite a case in point when millions of people are able to express their views before final decisions are being made.
So they make this whole process more inclusive and more accountable.
So what do you make of the role of, first of all, formulating and then consistent implementation of those five-year plans in the governance of China?
And why do you think the wisdom from the public matters in the governance of both, say, a local community, a local neighborhood, and on a bigger scale, the entire nation?
Well, the five-year plan system is a successful tradition and it's also a central pillar of the Chinese strategic governance.
But it evolves quite a great deal in divergence to the Soviet type of planning.
So it is there to ensure the country is there to coordinate resources and respect people's needs.
And they set up the long-term goal to be able to guide the structural transformation in a stable and orderly manner.
These plans are there to help, you know, to strike a number of balances between growth and distribution of social wealth and between reform and social stability.
And it also points to the national priorities with also consideration of the local peculiarities.
So the current The five-year plan is there to ensure that China continues its high-quality growth rate and to achieve the Chinese-style modernization where the economic efficiency, social equity, and environmental quality are being implemented in parallel instead of focusing on one GDP agenda.
Earlier this year, in a symposium held in Shanghai on China's next five-year plan, we know Xi Jinping stressed giving strategic priority to new quality productive forces and enhancing people's livelihoods.
On these two issues, Professor Liu, what do you think are some of the major concerns or some of the major aspirations from China's general public?
Well, I think the central government has already identified the Chinese major problem is the gap between the supply side in terms of the material provision, in terms of the system provision in public goods versus people's rising needs in their continuously raising their livelihood.
So to be able to bring such a gap, innovation is the way. that is there to not only to generate more of the goods that are needed by those consumers as a general public, but it also there to be able to use more of the digital technology to understand what exactly people's needs so that we will be able to prevent some of the missteps in creating redundant capacity, in creating a lot of waste and also in creating a lot of environmental damages in the immediate catering to people's present needs.
So it also is there to ensure that China is there to remain increasingly competitive in the global marketplace by the taking is the aspiration of the people, having more of their conception power unleashed to attract foreign investment.
And while in the meanwhile, we are able to not only export, but also invest more firmly in the global marketplace and team up with the global South.
So I think all in all, the education, and skill training are really essential at this stage because to have high quality development, you need innovation and also you need innovative ways to raise people's capacity so that they do not only learn the skills as how to They manage the digital and biotechnology, but also they are able to gain better knowledge in how to navigate their lifestyle so that they get the most out of the high quality growth.
Because after all, they're raising people's living standard. is the final goal.
And high-quality growth is the mean to be able to achieve that through innovation.
It's not only in technology, but also in our governance and also in our social management.
Your point is well taken. Thank you very much for joining us, Professor Liu Baocheng from the University of International Business and Economics.
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Beijing is demanding answers from Nvidia just weeks after Washington lifted the export ban on its AI chips.
China's cyberspace regulator has summoned the US chip company, raising concerns that its H20 chips contain backdoors.
What exactly is a hardware backdoor? Are China's worries about chip security justified?
How difficult is it to prove a chip is truly secure?
And if backdoor functions are validated, what could this mean for NVIDIA's business in the world's second largest market?
Join us for an unfiltered look into the growing chip security storm at the chat lounge, wherever you get your podcasts, and on CGTN Radio.
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Several Chinese government bodies have held mid-year meetings to better support economic growth for the rest of this year.
The People's Bank of China pledged to increase the money supply and lower borrowing costs to ease financial burdens and stimulate demand.
And to fully unleash domestic demand, the finance ministry has committed to rolling out subsidies for personal spending and business loans in the services industry.
Meanwhile, the National Development and Reform Commission has announced a plan to issue a fourth batch of ultra-long special treasury bonds worth 69 billion yuan, or some 10 billion U.S. dollars, in October.
For more, my colleague Zhao Yang spoke with Professor Qu Qiang from Mingzhu University of China.
So, Professor Qu Qiang, the central bank has pledged more liquidity and lower borrowing costs.
And last week's political bureau meeting set the tone for China's economic development for the second half of this year, calling for a more proactive fiscal policy and a moderately accommodative monetary policy.
So how do you explain it and what specific measures might we see?
Well, I think Central Bank of China has already made the promise to lower the interest rate and also make the monetary environment, you know, more easier.
So I think in the second half of the year, we're going to see many policy packages coming out, for example, lowering the LPR.
And also there are some more of the structural monetary policy tool. uh to be used in the targeted area for example like the housing area like to support the sme like to support the uh services and you know consumptions and also to support the uh senior citizens old age caring and all that kind of health care expanding and meanwhile technology-oriented enterprises will also get their support continuously.
And also we're going to set up a new bond area tool to support the technology and innovation to shoulder the risks together with this innovative enterprises and the startups.
So I think all this will actually help China to increase the economy growth and also to lower the comprehensive cost in the financing.
And meanwhile, I think the government want to use the financial tool to support targeted area, for example, the old age caring services and the baby and the newborn, and also to support the technology and innovation.
So I think finance is still just a tool.
But I think the whole target is to make Chinese economy more mature and its growth to be more steadier and also healthier.
And we know that despite various accidental headwinds, China's first half year GDP grew by 5.3%, beating the expectations.
So what factors have helped the economy stay resilient? i think there are several reasons behind that and number one is that uh the chinese economy itself is very very large uh second largest economy of the whole world 1.4 billion a population and also the people's consumption power and the whole healthiness of the whole economy is actually being there you barely cannot see another country in the whole world with such a a comprehensive industrial chain within just one country.
So to put into easier words is to speak English, that is China can basically build anything you need.
So that is, I think, the confidence coming for the resilience of the country's economy.
And also, I think China is a very supportive trading partner towards all the world countries.
For example, the emerging markets right now, most of them having their own ambitious target to modernize their economy, to digitalize their economy. platform.
So they want to use Chinese mechanics, Chinese equipment to help them and also help their economy to grow.
And also for the advanced economy, like in North America, like in the European Union, they probably value more about the Chinese products and its affordability and also quality.
Because if you want to buy the same quality of product, they probably cannot see uh this kind of the uh good price and also if you're seeing the good price probably you cannot match chinese products with the quality so i think this kind of the balance actually has made chinese products a very competitive in the europe market as well as in the north america so i think the export and outside demand are also there and also thirdly last but not least i think The Central Bank of China and its policy are very supportive, provided very good disabilities and also the drive for the economy to go forward.
So I think that's the reason why we'll be seeing China is still probably the only economy, large economy has more than 5% of the GDP gross annual rate above all.
And China has made boosting domestic consumption a key priority.
The government has a 300 billion yuan bond plan to boost the consumer goods trade-in program.
And China's service consumption has also grown rapidly.
So how can these current measures unlock the long-term domestic demand?
Well, I think the trading policy will still continue.
Actually, in the first half of this year, I think all kinds of the mechanics and equipment and the procurement and also the investment has been growing more than 18% and also the consumption products.
Actually, through the trading policy, I think we have already achieved 1.8 trillion yuan worth of a product.
So I think this policy actually has been working pretty well.
And plus, if you are right now in China, you will know that AI industry, this kind of upgrading for the traditional industry. uh it's kind of the program actually been going really fast so uh lots of the old factories old infrastructures right now are trying to upgrade its technology to adapt it to ai adapted the digitalization so i think this is uh production on one side but also this is a huge demand and in a longer turn i think we will probably need to focus more on you know service sectors especially when chinese economy is going across the threshold, of the US$13,000 GDP per capita, which means China is going to be a mid- and high-income country.
So at that moment, I think the service sectors, probably their share in the GDP is going to be more than 50%, which means most of the people work in the service sectors.
So how we can stimulate more of the demand in service and related consumption will become the key for the long-term demand and long-term economic growth.
And during the first half of this year, the exchange rate of Chinese yuan against the US dollar also appreciated.
So how do you evaluate the yuan's recent performance and what role does a stable exchange rate play in supporting the trade and investment?
The exchange rate is basically a mirror to reflect the confidence towards one economy and the healthiness of its own domestic market.
I think China's exchange rate, the renminbi exchange rate, actually are showing this kind of the confidence.
Like we just mentioned, the resilience, the large size market, no matter from the export or the domestic demand, I think Chinese economy is pretty much very balanced as a heavyweight economy.
And also, I think also half of the problem also come from America side.
As we've been seeing that the job market number has been down to very very Unexpectedly and that's a small number.
I mean, this is basically, you know caught by half So I think the number probably is before indicated, you know realistic before so it shows that in America The market is not that stable.
Especially if you take a look at the American stock market has been turbulent very very hugely and So that makes US dollars exchange rate softer.
So on the contrary, Chinese economy and the Chinese exchange rate also looks even better.
So I think that's the reason why the exchange rate has been performing pretty well.
And also we have one expectation that American US dollars exchange rate is going to go even lower at the end of this year.
This is probably a sure bet on the foreign exchange market.
And despite the strong numbers in the first half of this year, challenges still remain.
For example, the real assets remain sluggish and the trade tensions with the U.S. continue.
So what's your outlook for the second half of this year?
Where might we see new sources of growth?
Well, I think for the second half of the year, domestically, we are going to see more of the policies pushing out.
I'm pretty sure in the second half of the year, we're going to see more of the policy come out, monetary fiscal policies, Especially I think the fiscal policies and also the financial policies towards people's consumption were going to be more than currently to help the economy to rebound.
And also I think the problem and challenge for China right now is still within the home market. so if we can stabilize further with the house market i think the people's expectation for the future is going to be even better how the government is going to on one hand stabilize the housing market on the other hand do not you know stimulate a you know another round of the heat in this market i think this balance needs to be really really you know uh controlled and also outside of china i think the problem comes from geopolitical conflicts and also the americas tariff war against the whole world so america's economy itself is right now a very large question mark we don't know how it's going to evolve but the current signals are pointing at a recession at the end of this year or the beginning of the next year And also the tariff war is not only going to hurt America's economy, but also is going to hurt the whole world.
A lot of people saying, OK, 15% is not that high.
Well, if you're talking about 15% towards the whole world, that's going to be a problem.
So I think we really need to get prepared not only for China itself, but also especially for the outside impact towards the towards the world market.
That's spell over a problem. Professor Qu Qiang from Mingzhu University of China speaking with my colleague Zhao Yang.
Coming up, Japan clinches a US$6.5 billion warship deal with Australia.
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We'll be back after a short break. You're back with World Today, I'm Ding Heng in Beijing.
Japan has clinched a US$6.5 billion deal to build Australia's next-generation warships.
The agreement is going to see Mitsubishi Heavy Industries supply the Royal Australian Navy with upgraded Mogami-class multi-role frigates from the year 2029.
Australia plans to deploy these new ships under plan to its maritime trading routes and northern approaches in the Indian and Pacific Oceans.
The deal is marking Japan's most consequential defense sale after ending a military export ban in the year 2014, and a step away from the country's post-war pacifism.
So joining us now on the line is Professor Shending Li from the Institute of International Studies, Fudan University.
Thank you very much for joining us. Thank you.
So the upgraded Mogami-class frigates can launch long-range missiles, and they have a range of up to 10,000 nautical miles, much higher beyond the current, the existing capability of Australian Navy vessels.
Japan says the deal's benefits would include They enhance the joint operations and interoperability with both Australia and the United States.
So, Professor, how do these acclaimed benefits sound to you?
Well, I think Japan may want to reap multiple benefits.
One, to have a major military sale to show it is a bigger player in the international military hardware market.
Second, to make money. And third, to work with Australia and the common, the collective friends, America, et cetera, to defend the security order that they claim should be the case.
And they may have some concern that with the rise of China, the security order they have been accustomed to has been under certain change.
They don't want to see such a change. Now, it seems for both Japan and Australia, countering China's military power in the Asia-Pacific region is one of the aims of this particular deal we are talking about here.
Professor Shen, do you believe China is posing a threat to Japan or Australia in the region?
Well, in Japan, in Australia's view, Threat comes from a certain nation's rise of military capability plus sometimes its political intent.
So actually China's military capability, competence is really rising.
No question about this. But in China's view, China has no evil intent to threat other countries legitimate national interest.
But China's own legitimate national interest to reintegrate with Taiwan. to put mainland and Taiwan together to achieve a Chinese dream is being threatened by America and America's friends, its allies in the region.
So in China's view, America is threatening China in terms of capability and intent.
And in Japan, Australia's capability has not been as competent as China's. but their current behavior to build warships together and to think maybe China's legitimate national interest threats their illegitimate national interest.
This is totally unacceptable by China that would in turn probably drive China to build more competent military capability to attain Eventually, China's realization owes its legitimate national interest.
I take your point. So are you concerned about the fact that Japan nowadays no longer has a military export ban?
Well, Japan, after 80 years of ending the Second World War, we do see that Japan has been peacefully developing for many years. congratulating to Japan for this.
But there are also many concerns regarding Japan's, some politicians, sometimes its leading politician, unwillingness to reflect its historical wrong, refusing to admit its historical evil.
This has made Japan not that much to be trusted by countries like China and some others.
Then, plus the rise of Japan's military capability and its export of military hardware to other countries, that gives countries like China a real sense of insecurity.
So in 2016, Australia actually rejected a Japanese submarine program in favor of a French design.
But later on in 2021, Australia actually scrapped the French project, choosing instead to build a those nuclear-powered submarines, planned nuclear-powered submarines with the United States and Britain under this AUKUS deal or package.
So with that in mind, Professor Shen, do you see any possibility for something similar, for the kind of similar occurrences to repeat, like, for example, Australia in the future is going to abandon this warship deal with Japan once again in favor of something else?
Theoretically, this is not impossible. I mean, it is possible that someday the Trump Pentagon may talk to Canberra, look, my country my attack submarine is more competent, you guys need to buy American submarine, and Japan may yield to the pressure from the US, and Canberra may make another change.
This is possible, but I think Australia would feel this time somehow it's moderately obliged to Japan.
It does not want to see it would owe Japan for two times.
So I would see for such 11 frigates, these are not 11 destroyers.
So it's likely that at least Australia and Japan would implement some part of this deal.
Even so, it may not be a complete deal. The current deal they have signed so far represents an initial contract, I guess, or to put it this way, the first phase.
But later, more details are still to be hammered out and negotiated between Tokyo and the camera.
So the final question before we let you go, Professor Shendingly, Do you think there is a solution that can enable every country in this Asia-Pacific region feel secure enough?
Of course. If the US would not act in a way to boost those people in Taiwan, especially those pro-independence elements, China would see less threat from the U.S., even though the U.S. is a military hegemon in the world.
Then China would have less need to build up our own muscle, which in turn might be interpreted by Japan, Australia, and the U.S. as a rise of China's military capability, which in their eye constitutes a threat.
Every country should act in a way in accordance with international law, not to threat other country in violation of international law.
Then China, Australia, China, Japan and China, US would have much better chance to work together more peacefully to sort out their various differences.
Thank you very much for joining us and for your valuable analysis.
Professor Shending Li joining us from Fudan University.
Coming up, Kremlin plays down President Donald Trump's nuclear rhetoric as U.S. envoy is due to visit Moscow.
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You're back with World Today. I'm Ding Hen in Beijing.
Moscow says it is anticipating talks with U.S.
President Donald Trump's special envoy Steve Whitakoff later this week.
A crumbling spokesperson says Russia considers this meeting or contact important and helpful, adding that President Vladimir Putin may also meet with the U.S. envoy.
Trump said on Sunday that Steve Vityakov is going to travel to Russia ahead of a Friday deadline for Moscow to agree to a ceasefire with Ukraine.
The U.S. president has ordered the deployment of two nuclear submarines to the regions around Russia.
Kremlin has urged the caution about what it calls nuclear rhetoric.
The deployment of the twin U.S. submarines came after former Russian President Dmitry Medvedev raised the possibility of a full-scale war in online rhetoric.
So joining us now on the line is Professor Xu Bo, Director of the Institute of International Relations, China Foreign Affairs University.
Thank you very much for joining us. So, Professor Xu, why do you think Kremlin, while urging caution for sure, has actually played down President Donald Trump's order to move these two nuclear submarines closer to Russia?
First of all, I think Russia is very clear the United States are Donald Trump's top priority.
So I think by now the United States top priority is how to reach a ceasefire deal with Russia, between Russia and Ukraine.
And we can see in the past several days, that is how Donald Trump tried to use almost every measures to pressure Russia to reach a ceasefire deal.
So we can see he already threatened to further economic sanction of financial punishment. of Russia and we also can see Donald Trump at the economic sanction to his tariff deal with other countries such as he tried to persuade China or India not buying oil from Russia.
So I think this is also a sign of how the United States try to pressure Russia to reach a deal so I think Russia is very clear about that so second I think Russia is also notice are aware of the possibility the potential consequence of possible nuclear wars if between two countries so I think during especially during the Cold War the both sides they very clear about the possible consequence of nuclear war so that is why I think now they don't play a play down Trump's order of moving two nuclear submarines.
So should a ceasefire deal on the war in Ukraine not be reached by Friday?
Trump has said that he would impose sanctions and secondary tariffs on Moscow to discourage other countries from trading with Russia, like you mentioned earlier.
So do you think US sanctions and secondary tariffs would work in terms of pressuring Moscow into a ceasefire deal?
So I think there will be limited effects of this kind of economic sanctions or secondary tariffs.
So by now, I think in the last three years, the United States and its allies have already imposed very strict economic sanctions on Russia and that now the stop Russia's military action in Ukraine.
So this is not what will happen. And second, I think the Russia really, so when we look at the current conflicts between two countries, Russia and the Ukraine, And this is really, to Russia, this is really about, it's a survival issue of security, top security issue.
So Russia will not back off if you just threaten or you imposing economic sanction.
So I think the Russia will not play the role.
So in your observation between the United States and Russia, which side do you think is on a relatively speaking on a stronger position right now when we talk about negotiations over the Ukraine crisis?
So I think both sides have advantage and disadvantage side.
So in terms of Russia, and so I think the Russia has very obvious advantage aspects.
So the first I mentioned, this is the issue of survival of security issue for Russia, and definitely Russia would like invest more resources into this issue.
And second, I think the Russia now, especially during the summer, aggressive military actions.
So now Russia take upper hand in the military field due to the in what the the new round of military action in the region so this part i think is the advantage part of russia but definitely the russia also confront disadvantage part so for example we mentioned about the economic sanction And the NATO support and its allies support Ukraine and the Ukraine, the resistance against the Russians military action.
So I think this is in terms of Russia side.
And for United States, the disadvantaged side of United States, I think the United States has to manage its relationship with Russia. not just with Russia, but also had to manage the relationship with its allies, the European allies, like the European unions, the France, UK, and Ukraine, right?
So this is a much more complicated process for the United States to coordinate their policy positions.
The final question before we let you go, and briefly, Professor, do you think what has occurred in the recent month tells us that the improvement in this relationship between Moscow and Washington has hit a ceiling.
Why or why not? I think it's much more like a ceiling.
And I think both sides, the United States and Russia, they have totally different policy objectives.
And we also can see the President Putin mentioned he does not want a simple ceasefire deal.
He really wants security guarantee from other countries.
And on the other side, for the United States, he has to realize this is a complex process.
Indeed, it's very complicated. And let's wait and see what's going to happen.
And let's wait and see what's going to happen, especially after this upcoming Friday, this so-called deadline set by President Donald Trump.
But thank you very much for joining us. Professor Qu Bo, Director of the Institute of International Relations, China Foreign Affairs University.
Coming up, the global rollercoaster ride of President Donald Trump's tariffs has entered its latest phase.
So is America really winning? You're listening to World Today.
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US President Donald Trump is doubling down on sweeping tariffs, claiming they will make America quote-unquote great and rich.
But the global picture tells a more complicated story.
As inflation rises and job growth slows down, experts are warning that the economic burden is falling heavily on US households, while global trade patterns grow increasingly uneasy.
Countries across the world are adjusting their respective tariff strategies in response, triggering a broader recalibration with regard to global trade.
So for more, my colleague Song Ruixin earlier had a conversation with Professor Jiang Gong from the University of International Business and Economics.
Let's begin with how these tariffs are hitting the U.S. itself.
Like economists argue that it will largely be U.S. consumers paying for this tariff increase, effectively a new kind of tax.
So are American households truly bearing the brunt of Trump's tariffs?
That's what I think. I think that's definitely what's happening here right now.
But I think there are people in the Republican Party sort of refuting this argument by referring to current data on the Consumer Price Index.
I think the Consumer Price Index is not necessarily a very accurate reflection of measuring the tariffs impact.
And if you look at the particular items that are product items that are hit particularly hard, better tariffs, it's clear the implication is that consumers are paying for them.
You look at, for example, you look at the car prices, it's been rising remarkably, you know, for sure.
There are other items that are seeing price increase.
Washington Post today had an article about the impact on aluminum.
You know, you would imagine that tariffs on aluminum would help American manufacturers, American aluminum companies like Elco.
But the Elco company itself is saying that it's actually being hit hard and it has to increase prices.
So I think obviously there's a wide consensus among the economists community that it's indeed importers are paying for these tariffs and the tariffs actually being passed upon along to the consumers.
I think the overall impact will be seen with some time lag.
And I think eventually we are going to see a broad price increase as a result of the wave of tariffs President Trump has introduced on practically every country that trades with America.
It's a matter of the extent of inflation, but I think some level of inflation is almost guaranteed here.
Okay. A new Labor Department report shows that the labor market is currently weakening with only 73,000 jobs added in July.
That's well below expectations. So is cooling job market and, like you've said, rising inflation directly linked to this kind of tariff?
Or are there any other forces at play? I think the rising inflation is partly due to tariffs and probably mostly due to tariffs.
The cooling job market reflects the investment sentiment right now.
This means that companies are laying off people.
Companies are not so optimistic about the future and they're preparing for bad days and they're laying off people.
Some companies might be in just trouble right now.
I think tariff might be one of the reasons, but there are clearly other reasons that play as well.
For example, Maybe think of the impact of AI when machines are replacing people, that's also happening.
The federal government is laying off a lot of people, that's also happening.
So I think overall, there are several factors contributing to the cooling job market.
But I think the likelihood of a mild recession, let's put it this way, a mild recession is probably around the corner, given the growth statistics so far for the first half of the year.
So I think, you know, the tariff certainly doesn't help.
It's actually making things worse. So I think probably, you know, we're going to see the dire consequences of President Trump's grand tariff strategy.
It's something that the British has never seen before.
And I don't think it's going to fold well for American public.
But Trump says his tariffs will spur America into a golden age.
Are foreign governments and global markets seeing it that way?
You know, that depends on how we define the golden age.
I think in President Trump's eyes, a golden age means that it's going to be a period of time where investments will be pouring into the United States.
There will be prosperity in the United States.
There will be jobs and economic growth moving forward.
But so far, I'm a little bit skeptical that it's indeed happening.
If not, actually, we're heading towards an opposite direction.
So far, there is no clear evidence to indicate that the jobs and investments are coming, or at least manufacturing is going back to the United States as a result of these tariffs.
But still, this is just a very short period of time since the tariffs have been introduced.
But overall, I think probably President Trump is grossly overestimating things.
He's too much optimistic to compare the current economic status of the United States to America's historic golden age, that time was called the Gilded Age.
I think it's more of an exaggeration. It just doesn't compare at all.
I mean, how big a political issue could tariffs become in the coming month, especially with public sentiment and economic data diverging from the administration's messaging?
Well, I think when people realize that the prices are rising across the board, when people realize that essentially tariffs is a tax on them, it's a sales tax on them, American people are going to wake up and find out that it's not to their interest.
Particularly, I think the middle class, the lower class.
Income group of people, you know, they feel like their income is stretching thing and, you know, not buying the things they used to buy.
By that time, I think people are going to wake up and see that this is actually a tax on them.
It's an unauthorized tax. American public.
And to make things worse, it's a sales tax.
And sales tax usually work against the working class people because, you know, these are taxes imposed on things that people typically buy.
And, you know, as a percentage of income for the middle class and lower income class, the expenditures on these items holds a disproportionately high portion of the total income.
So essentially it's not even a A progressive tax scheme is essentially a regressive tax scheme, taxing more on the poor and middle class.
And by that time, I think people are going to realize what kind of a president they're actually voting for into the White House.
Let's now turn to the latest on the trade disputes between the US and other countries.
So it looks like President Trump is increasingly using tariffs as a kind of foreign policy tool, targeting not just the so-called rivals, but also long-term partners.
How do you make up this strategy? And are these tariffs really achieving foreign policy goals or risking long-standing alliances?
Well, first of all, President Trump is really fond of tariffs.
He calls himself a tariff man. The second thing is that I think America's foreign policy is indeed changing.
And using the tariff tool as part of the foreign policy toolbox is indeed what he desires of.
He is essentially upending and eviscerating the rules-based international order in the economic arena. that was actually established by the United States itself 70-some years ago.
I think President Trump is trashing all of these things, including the WTO, including the IMF and the World Bank, all these international institutions as part of the global governance order is something he wants to throw out of the window.
I think he's trying to establish essentially a set of bilateral relationships with every trading partner It's a hub-and-spoke system.
It's independent from the international rules-based order with the WHO at its core.
So it's entirely different, entirely new.
And he's using a tariff. And this certainly has foreign policy implications.
He's imposing taxes, imposing tariffs on allies and rivals alike.
So I think this is essentially a... You can think of this as a revolution in the sphere of foreign policy, as well as in international commerce.
So I'm not surprised that tariffs are being used that way.
It's not something just as a tactical tool.
It's a strategic tool that will have a long-term implication for many years to come.
Professor Zhang Gong from the University of International Business and Economics talking with my colleague Song Ruixin.
That's all the time for this edition of World Today.
I'm Ding He in Beijing. Thank you so much for listening.
Bye for now.
