China raises tariffs on $ 60 billion worth of US goods in tech struggle
The Finance Department said it was moving forward with plans announced in August for 10 percent and 5 percent increases on 5,207 types of US products.
China announced a tariff hike of $ 60 billion on Tuesday US goods in response to President Donald Trump’s latest tariff increase in a dispute over Beijing’s technology policy.
The announcement followed a warning from a US business group that a “downward spiral” in their conflict seemed certain following Mr. Trump’s sanctions on $ 200 billion in Chinese goods.
The Finance Department said it was moving forward with plans announced in August for 10 percent and 5 percent increases on 5,207 types of US products. A list released last month included coffee, honey and industrial chemicals.
Reduce “ trade frictions ”
The increase is aimed at curbing “trade frictions” and “US unilateralism and protectionism,” the ministry said on its website. He called for a “pragmatic dialogue” to “jointly safeguard the principle of free trade and the multilateral trading system”.
The Trump administration announced that tariffs on some 5,000 products made in China would start at 10% from Monday. They are due to drop to 25% on January 1.
A Commerce Department statement earlier said that Trump’s rise “brought further uncertainty to the consultations,” but no one was sure whether Beijing would drop negotiations proposed by Washington last week.
The United States complains that China’s industry development plans, including “Made in China 2025,” which calls for the creation of global champions in robotics and other fields, are based on stolen technologies, violate laws. commitments to open the Beijing market and could erode American industrial leadership.
American companies and their trading partners, including the European Union and Japan, have long complained about barriers in the Chinese market and industrial policy. But they oppose Trump’s tactics and warn that the dispute could chill global economic growth and undermine international trade regulations.
US Chamber of Commerce warns Washington
The American Chamber of Commerce in China has warned that Washington is underestimating Beijing’s resolve to retaliate.
“The downward spiral we previously warned about now appears to be materializing,” Chamber Speaker William Zarit said in a statement.
Trump imposed 25% tariffs on $ 50 billion worth of Chinese goods in July. Beijing retaliated with similar sanctions on the same amount of US goods.
The US tariffs were aimed at Chinese products, Washington said, which benefited from inappropriate industrial policies. Beijing sanctions hit soybeans and other agricultural products from states that voted Trump in 2016.
Mr Trump on Monday threatened to add an additional $ 267 billion in Chinese imports to the target list if China retaliates over the remaining US rights. That would bring the total affected by US penalties to $ 517 billion covering almost everything China sells to the United States.
“Contrary to what Washington thinks, China can and will sneak in and we are not optimistic about the prospect of a short-term resolution,” said Zarit of the US Chamber of Commerce. “No one will emerge victorious from this counterproductive cycle.”
House calls for ‘results-oriented negotiations’
The chamber called on both governments for “results-oriented negotiations”.
As Beijing runs out of U.S. proceeds for retaliation, U.S. companies say regulators are starting to disrupt operations.
Last week, the US chambers of commerce in China and Shanghai reported that 52 percent of the more than 430 companies that responded to a survey said they had faced slower customs clearance and increased inspections and procedures. bureaucratic.
The US government has removed certain items from its preliminary list of $ 200 billion of Chinese imports to be taxed, including child safety products such as bicycle helmets. And in a victory for Apple Inc., the administration cut smartwatches and some other consumer electronics.
“China has had many opportunities to fully respond to our concerns,” Trump said in a statement. “I urge the Chinese leadership to act quickly to end their country’s unfair trade practices.”
Mr Trump also complained about America’s yawning $ 336 billion trade deficit last year with China, its biggest trading partner.
Have you negotiated a truce?
In May, in fact, it briefly appeared that Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He had negotiated a truce built around a Chinese offer to buy enough American agricultural products and liquefied natural gas to reduce the trade deficit. But Trump quickly moved away from the truce.
In the first two tariff cycles, the Trump administration was careful to try to spare American consumers from the direct impact of import taxes. Tariffs have focused on industrial products, not on things Americans buy at the mall or through Amazon.
By expanding the list to $ 200 billion worth of Chinese goods, Trump could spread pain to ordinary households. The administration targets a bewildering variety of products, from sockeye salmon to baseball gloves to bamboo mats, forcing US companies to scramble to find suppliers outside of China to absorb import taxes or pass the costs on to their customers.
Sohn said the Trump administration was pursuing a legitimate goal of getting China to stop violating international trade rules, but that it should have garnered support from other trading partners, such as the European Union, the Canada and Mexico, and present Beijing with a united front.
Trump has strained relations with potential allies including the European Union, Canada and Mexico by increasing tariffs on imported steel and aluminum. He called on Canada and Mexico to renegotiate the North American Free Trade Agreement to make it more favorable to the United States.