China Plans Tariffs on $60 Billion of U.S. Goods

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China Plans Tariffs on $60 Billion of U.S. Goods

The Trump administration last month enacted a 25% tariff on roughly $34 billion worth of Chinese goods, prompting Beijing to retaliate in kind, and then threatened to slap additional duties on almost all Chinese goods sent to the US.

White House press secretary Sarah Huckabee Sanders countered by telling reporters today that "instead of retaliating, China should address longstanding concerns about its unfair trading practices".

Days later, Washington unveiled a list of another US$200 billion in Chinese goods, from areas as varied as electrical machinery, leather goods and seafood, that would be hit with 10 per cent import duties.

Chinese leaders have offered to narrow their politically sensitive trade surplus with the United States by purchasing more American goods. The vast majority of economists expect that rush to buy before the trade war escalated will be followed by lower than usual exports in the second half of the year. Last year, China imported about $130 billion of US goods. After the earlier action against $34 billion of USA goods, that left about $120 billion available for retaliation.

Beijing's earlier round of tariffs appeared created to minimize the impact on the Chinese economy by targeting soybeans, whiskey and other goods available from Brazil, Australia and other suppliers. On Friday officials also stepped into cushion the yuan, which has been battered by trade tensions and was approaching the key level of seven to the dollar.

The market is not large by value compared with approximately $12 billion of US crude that came to China a year ago, but LNG imports could shoot up as Beijing forges ahead with its plan to switch millions of households to the fuel away from coal.

Chinese authorities - bracing for economic fallout - have taken a range of measures in recent weeks to bolster the economy.

Signalling the nation's readiness to respond to higher tariffs threatened by Donald Trump on $200bn of Chinese imports, officials in Beijing said countermeasures were ready and waiting for the next move from Washington.

By comparison, companies in America sold £100bn ($130bn) of goods to China during the same period.

Washington has vowed to take punitive measures to stop Beijing's Made in China 2025 industrial policy supporting domestic companies developing strategic advanced technologies, including robotics and artificial intelligence.

The foreign ministry spokesman appealed to Washington to negotiate but could not confirm reports the two sides were setting up talks. It had also become the largest buyer of US crude oil outside of Canada, but Kpler, which tracks worldwide oil shipments, shows crude cargoes to China have also dropped off in recent months.

The step is reportedly being considered by the White House in order to narrow the trade deficit between the U.S. and China.

Much of American industry and many members of Trump's own Republican Party have expressed outrage but have so far been unable to thwart his trade policies.

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