China on Friday announced tariff hikes on $75 billion of U.S. products in retaliation for President Donald Trump’s latest planned increase, deepening a conflict over trade and technology that threatens to tip a weakening global economy into recession.
China also will increase import duties on U.S.-made autos and auto parts, the Finance Ministry announced.
The announcement comes as leaders of the Group of 7 major economies prepare to meet in France this weekend.
Tariffs of 10% and 5% will take effect on two batches of goods on Sept. 1 and Dec. 15, the ministry said in a statement. It gave no details of what goods would be affected but the timing matches Trump’s planned duty hikes.
Washington is pressing Beijing to narrow its trade surplus and roll back plans for government-led creation of global competitors in robotics, electric cars and other technology industries.
The spiraling conflict has battered exporters on both sides and fueled concern it might drag down weakening global economic growth.
China’s government appealed to Trump this week to compromise in order to reach a settlement.
That came after Trump warned that the American public might need to endure economic pain in order to achieve long-term results.
The United States, Europe, Japan and other trading partners say Beijing’s development plans violate its market-opening commitments and are based on stealing or pressuring foreign companies to hand over technology.
Some American officials worry they might erode U.S. industrial leadership.
Chinese leaders have offered to alter details but are resisting giving up a development strategy they see as a path to prosperity and global influence.
The talks are deadlocked over how to enforce any deal. China insists Trump’s punitive tariffs have to be lifted as soon as an agreement takes effect. Washington says at least some have to stay to ensure Beijing carries out any promises it makes.
Trump announced plans to raise tariffs Sept. 1 on $300 billion of Chinese products after talks broke down in May. Increases on some goods were postponed to Dec. 15.
Trump escalated “trade frictions” that are “seriously threatening the multilateral trading system,” the Finance Ministry said. “China was forced to take countermeasures.”
A separate statement said tariffs of 25% and 5% would be imposed on U.S.-made autos and auto parts on Dec. 15. Beijing announced that increase last year but suspended it after Trump and his Chinese counterpart, President Xi Jinping, agreed at a meeting in December in Argentina to put off further trade action while they negotiated.
Trump and Xi agreed in June to resume negotiations. But talks in Shanghai in July ended with no indication of progress. Negotiators talked by phone this month and are due to meet again in Washington next month.
Trump already has imposed 25% tariffs on $250 billion of Chinese products. Beijing retaliated by imposing its own penalties on $110 billion of American goods. But their lopsided trade balance meant China was running out of imports for retaliation.
Friday’s announcement, if it applied to goods not already affected by Chinese penalties, would extend tariff hikes to everything China imports from the United States. That would match Trump’s hikes, which cover almost all of what Americans buy from China.
(AP)
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5 Responses
I won’t lose any sleep over the China tariffs, our great deal maker who happens to be the chosen one will sort things out,
In the meantime the USA is the laughing stock of the world,
Thanks Mr Trump
No problem. A stable genius once said trade wars are easy to win. No end in sight to this war.
While this is bad for American corporate profits as well as American farmers as well as American consumers, it should prove advantaeous for American manufacturing as well as pro-American third world countries posed to replace China as the place Americans off-shore to.
If this all goes badly, the worse that happens to the USA is that Trump loses and we get nutty left-wing crypto-socialists running the government. Not being a democracy, the worst that happens to the Chinese leadership is they get removed “with extreme prejudice”.
Good for manufacturing? U.S. Steel just laid off 200 employees in Michigan
“it should prove advantaeous for American manufacturing ”
Not true. It increases costs for American manufacturers and cuts them off from export markets. Tariffs are simply bad, all around.
One might have thought that Herbert Hoover’s incredible error in signing the Smoot-Hawley tariff bill, that turned the American recession into a worldwide depression, and led to the Nazi takeover of Germany after that country’s economy collapsed, would have taught us a lesson.
We do need to replace Trump and hopefully that will be with a centrist Democrat, but at this point anything could happen.