US President Donald Trump has ignited his trade war with China, slapping tariffs on tens of billions in Chinese imports and sparking immediate retaliation from Beijing.
The moves on Friday brought the world’s two largest economies to the verge of an all-out confrontation long feared by markets and industry.
And the China trade offensive is only one side of Trump’s multi-front battle with all major US economic partners.
The announcement caps months of sometimes fraught shuttle diplomacy in which Chinese offers to purchase more American goods failed to assuage Trump’s grievances over the soaring trade imbalance and Beijing’s aggressive industrial development policies.
And as Trump warned of “additional tariffs” should Beijing hit back with tit-for-tat duties on American goods, China unveiled 25 percent duties on $50 billion in US imports.
“The United States can no longer tolerate losing our technology and intellectual property through unfair economic practices,” Trump said.
“These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs.”
But at least initially, Trump’s new China tariffs will not cover the full $50 billion that Trump announced Friday.
US Trade Representative Robert Lighthizer said the punitive duties will apply on 818 Chinese products valued at $34 billion starting July 6, with a second list of $16 billion to be considered under a new review process — bringing the total possible affected import volume to $50 billion.
But it is likely companies will seek more exemptions so the final total could fall short of that amount.
Beijing’s countermeasures closely mirrored Washington’s, with 545 American exports, also valued at $34 billion, facing punitive duties as of July 6, including agricultural products and vehicles, according to the official Xinhua news agency.
The State Council said another 114 items will be subject to tariffs at a later date, according to Xinhua.
US farmers are especially concerned about the impact of a trade war, since they are sure to feel the hit.
China’s Ministry of Commerce said the decision to impose tariffs meant “all previously agreed trade negotiation results are no longer valid.”
American farmers are especially worried about a trade war, as they are sure to feel the hit
“It is deeply regrettable that in disregard of the consensus between the two sides, the US has demonstrated flip-flops and ignited a trade war,” the ministry said.
It also called on other countries to “take collective action” against this “outdated and backwards behaviour.”