Published: Sat, August 04, 2018
Economy | By Melissa Porter

China announces $60B of U.S. goods for tariff retaliation

China announces $60B of U.S. goods for tariff retaliation

Trump, who has accused China and others of exploiting the United States in global trade, has demanded that Beijing make a host of concessions to avoid the new duties, which could be imposed in the weeks after a comment period closes on September 5.

The Trump administration is proposing raising tariffs on $200 billion of Chinese imports to 25% from an originally planned 10%. On Friday, the Ministry of Commerce described its planned response: four different types of tariffs on $60 billion of USA goods.

The administration's approach to China is the same one it has employed in dealing with North Korea, Iran, the European Union and NAFTA partners.

Trump campaigned on a promise to bring down America's massive trade deficits by renegotiating trade agreements and getting tough on countries like China that sell the US far more than they buy from it.

Chinese shares fell on Thursday, and so far this year, the Shanghai Composite Index has slumped more than 16 per cent, the world's second-worst performing stock index.

The US dollar has strengthened by 5 per cent against China's yuan since the beginning of the year and has risen by around 3 per cent on a trade-weighted basis against the currencies of other major USA trading partners.

And Bergsten warned that the United States economy is likely to slow and a trade war only makes that expected decline worse.

Trump set his sights on China during the 2016 presidential campaign and has followed through during his presidency with a protectionist strategy that he says is aimed at strengthening USA companies and boosting jobs at home.

Increasing the pressure on China by threatening even higher tariffs could backfire.

The escalating conflict between the White House and China shows no signs of abating.

Trump's tariffs target goods the White House says benefit from industrial policies such as "Made in China 2025", which calls for developing Chinese competitors in robotic, artificial intelligence and other fields.

There was no immediate reaction from the Chinese government.

Growth in the third and fourth quarters is likely to be slower as these temporary effects unwind and the baseline for quarter-on-quarter comparisons becomes more challenging. "The cost increases will be passed on to customers, so it will affect most Americans pocketbooks". Consumer price inflation is also rising and starting to erode the real value of wage rises.

Washington imposed additional 25 percent tariffs on $34 billion of Chinese goods July 6 in response to complaints Beijing steals or pressures companies to hand over technology.

Bloomberg reported on Tuesday that the administration was considering boosting tariffs to 25 percent. That prompted concern among American companies that retaliation might expand to disrupting their operations in China.

"More broadly, however, the effect of tariffs on consumer demand could be significant".

"We hope that those directly involved in the United States' trade policies can calm down, carefully listen to the voices of USA consumers. and hear the collective call of the global community", Wang Yi, the Chinese government's top diplomat and a member of the country's state council, or cabinet, said in Singapore.

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