Trade war erupts as China fights back against USA tariffs

Jul 07, 2018, 02:55
Trade war erupts as China fights back against USA tariffs

Those caught in the initial line of fire - US farmers facing tariffs on their exports to China, for example - are already hunkered down and fearing the worst. "A deficit is actually a good thing for the USA because we're the world's biggest economic power, and other countries are willing to hold our debt", said Hsu. Instead, he should be talking about reciprocity and allowing American companies the same rights in China that America grants Chinese companies when they try to invest and operate in the United States.

Under a full-blown trade war in which the United States slaps 10 per cent tariffs on all other countries and they respond, the economists reckon USA growth would slow by 0.8 percentage point by 2020.

"So we have 50 plus 200 plus nearly 300", Trump said, adding "It's only on China". Eastern time Friday on $34 billion worth of Chinese imports, a first step in what could become an accelerating series of tariffs.

Trump and his advisers argue the tariffs are necessary to pressure China into abandoning unfair practices such as stealing intellectual property and forcing American companies to hand over valuable technology.

After China announced its willingness to retaliate with a similar amount, Trump threatened tariffs of 10 percent on $400 billion more of Chinese products.

An official at a company in Shanghai that handles customs clearance for importers said to Reuters that the port of Shanghai is said to have put on hold clearing some United States imports through customs.

As the deadline approached with little sign of a last-minute deal, USA stocks pared gains.

China's commerce ministry said it had lodged a new complaint with the World Trade Organization (WTO).

Farmer John Duffy loads soybeans from his grain bin onto a truck before taking them to a grain elevator on June 13, 2018 in Dwight, Illinois. The Communist Party newspaper People's Daily said tariffs were imposed on a list of goods issued last month that included soybeans, pork and electric vehicles. Requests for comment went unanswered at the U.S. Treasury, USTR and the U.S. Commerce Department.

Chinese stocks have taken a beating in recent weeks, entering a bear market, as concerns about the trade-war have mingled with worries about how an ongoing debt-control campaign will feed through into the outlook for economic growth.

Foreign companies accounted for $20 billion, or 59 percent, of the $34 billion of exports from China that would be subject to new USA tariffs, with US firms accounting for a significant part of that 59 percent, Gao said. But President Trump's fundamentally nativist outlook and his take-no-prisoners, give-no-quarter negotiating style, Indian officials are acknowledging privately, comes as a sobering reminder that there is no such thing as a free lunch or friendship based on geo-politics with a businessman-President.

The Trump administration's first round of duties hits major Chinese technology products, and another round of tariffs on $16 billion worth of goods is set to go into effect as soon as August.

"If the United States starts imposing additional tariffs, it will actually be charging taxes on firms both in China and around the world, as well as American companies", Feng, said at a news conference in China.

"We never wanted to see the escalation of trade frictions into a trade war". It said US companies want fairer treatment but will be hurt by US-Chinese tensions. It said they would damage the global economy unless other countries stop them.

The list avoids direct tariffs on consumer goods such as cellphones and footwear.

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