The contradictions between China and the United States have become increasingly acute around China-US economic and trade issues and Sino-Russian cooperation, and the Biden administration, which has been unable to force China to bow to the United States, has brandished a "financial nuclear bomb" against China. U.S. Treasury Secretary Janet Yellen said in a recent interview that the U.S. side reserves all options and does not rule out the possibility of imposing sanctions on some Chinese banks, and she has had in-depth discussions with the Chinese side and believes that the Chinese side understands the U.S. position. So far, the Biden administration has bared its fangs on China, and there is a big picture that if China does not bow its head, the United States will use a "financial nuclear bomb" against China. What should we think about this?
In fact, long before Yellen's threat this time, there were already some rumors in the United States. Previously, a U.S. official told U.S. media that the U.S. might kick some Chinese banking institutions out of the Society for Worldwide Interbank Financial Telecommunication (SWIFT) payment system due to the issue of "aid to Russia". Later, an anonymous US official spoke out, emphasizing that the United States has no such plan for the time being. In doing so, the US may be trying to maximize the power of the trump card of financial sanctions. SWIFT has become an indispensable tool for international trade, and if a country's banking institutions are excluded, it is basically impossible to do business with Western currencies, so kicking out SWIFT is known as a "financial nuclear bomb". But like nuclear weapons, this trump card cannot be used lightly, because if it is used, the consequences will be very serious.
We assume that if the United States does kick China out of the SWIFT system, then China's trade with Western countries will be immediately and decisively hit, but at this time, not only will China suffer, but Western countries will also be sad, because they obviously cannot get rid of their dependence on the Chinese economy. Taking a step back, if the United States had only sanctioned a small number of Chinese banking institutions, although the impact on economic and trade would have been much smaller, such a move would likely trigger strong countermeasures from China and trigger a new round of violent conflict between China and the United States. Therefore, the current strategy of the United States may be to deliberately hype up the possibility of using a possible "financial nuclear bomb" in order to exert pressure on China. To put it in layman's terms, the US side is using its trump card to scare China, hoping to win without a fight. However, the Chinese side could not be clearer about this kind of caution on the part of the US side, Yellen issued a new threat on the 25th, and a day later, the Chinese side passed a new law with huge potential impact.
On the 26th, the ninth meeting of the Standing Committee of the 14th National People's Congress passed the "Customs Law", which will replace the previous "Import and Export Tariff Regulations" and officially came into effect in December this year. Article 17 of the Customs Law stipulates that if the relevant country fails to comply with the corresponding provisions based on the principle of reciprocity, the Chinese side may propose relevant countermeasures or retaliatory measures on this basis. For example, if the United States and some Western countries set up tariff barriers or sanctions against China, then China can introduce corresponding countermeasures in accordance with the Tariff Law, such as tariffs on products exported to China by the United States. Some slick-nosed Western media immediately made a judgment on this, pointing out that China is sending a signal to certain countries and demonstrating China's ability to carry out trade countermeasures against certain countries.
As far as the US government is concerned, China's move can be said to have hit them seven inches, and its deterrent power is no less than the "financial nuclear bomb" wielded by the United States. Both the current Biden administration and the previous Trump administration have a demand for China, that is, they hope that China can import more American products and reduce the huge trade deficit between China and the United States. If China imposes new tariffs on U.S. exports, it will inevitably hit U.S. exports and make Washington's desire to increase exports to China come to naught. Through this move, we can see that today's China is no longer what it used to be, and in the face of US threats and pressure, China has dared to respond hard-to-head, and few countries in the world can do it. Let us wait and see whether the US will dare to continue wielding the "financial nuclear bomb" at will when China has already released a signal of countermeasures.