Monday, 20 August, 2018

Australia hurts as China and U.S. head towards trade war

President Donald Trump gestures as he signs a Australia hurts as China and U.S. head towards trade war
Nellie Chapman | 20 June, 2018, 18:38

-China Business Council in Beijing, said some companies have reported Beijing is meeting with Chinese businesses to discuss shifting contracts for usa goods and services to suppliers from Europe or Japan, or to local Chinese firms. The ministry also expressed its disappointment that the new tariffs do not reflect the "consensus" the two countries had come to during recent trade negotiations, after which China declared the trade war was over.

Beijing immediately retaliated by matching the United States levy, but Mr Trump asked officials on Monday to identify $200bn of Chinese goods to be subject to a 10% tariff.

USA officials will hold a press conference on the decision to impose further tariffs on China this morning.

The new U.S. tariffs take what had been a trade spat that appeared to be calming to the next level. But the rhetoric is intensifying, with Trump lashing out at Beijing over its threat to retaliate against the administration's latest proposed tariffs.

Trump issued a statement this evening noting that "unfortunately" China "apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology".

"Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong".

US stock market tumbled on Tuesday following the latest salvos between Washington and Beijing.

On Tuesday, the U.S. Dow Jones Industrial Average opened more than one percent lower. Boeing's stock shed 4.3 percent, Caterpillar 4 percent and GE 2.2 percent. "It's time, folks. It's time", Trump said.

China and the United States traded goods and services worth over $650 billion in 2016.

"If the United States acts irrationally and issues a list, China will have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures".

"If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another $200bn of goods". Most goods worth more than 200 Canadian dollars are subject to duty and taxes if brought in more than 24 hours after purchase.

Russian Federation is also pushing back on United States tariffs.

Economists complain that Trump's efforts to reduce America's deficit are misguided, saying the gap in trade with China reflects the underlying economy.

China's foreign ministry also warned the US was initiating a trade war.

"It's clear that China does have much more to lose", he told reporters, noting that China exported more than $500 billion to the U.S. previous year, far more than the $130 billion it imported from the United States.

Russia's Economy Minister, Maxim Oreshkin, said the tariffs would target goods of which the Russians already had domestic equivalents.

"Donald Trump is not constrained by the establishment", Edward Alden, a trade expert at the Council on Foreign Relations, told AFP.

This is what a trade war looks like.

Since June 1, steel and aluminium imports from the European Union, Canada and Mexico have been hit with tariffs of 25% and 10%, respectively. However, for oil exporters, shipments to China account for 16 percent, both figures based on data from the first five months of 2018. They include electric cars, whiskey and soybeans - a politically and economically vital export of America's heartland, where Trump enjoys support.