Friday, 22 February, 2019

China blames U.S. for ‘largest-scale trade war’ as tariffs kick in

US plans to go ahead with tariffs on $34 billion of imports from China on Friday US plans to go ahead with tariffs on $34 billion of imports from China on Friday
Nellie Chapman | 07 July, 2018, 02:53

Opening shots were fired at 12.01am this morning as Washington stuck to its deadline and began imposing tariffs on $34bn of Chinese goods. He also noted that about $20 billion of the goods that will be subject to the USA tariffs are supported by foreign investors, including many from the United States.

Amid a relatively well-supplied global oil market, energy consultancy Wood Mackenzie said the United States "would find it hard to find an alternative market that is as big as China", as Chinese buyers make up 20 percent of USA overseas crude sales. "American spirits exports to China have grown by nearly 1,200%, from $959,000 in 2001 to $12.8 million in 2017".

China criticized, what it called, "trade bullying" and warned the tariffs could start worldwide market unrest.

China's imports from the U.S. were just US$130 billion previous year and so Beijing does not have the capacity to hit back in kind, raising speculation it could respond by creating administrative headaches for companies in China.

Despite frustration with Chinese trade practices, which require foreign firms to spill trade secrets to access the 1.3 billion-person market, USA businesses have warned for months that Trump's trade threats may do more harm than good.

Together, the two rounds - $34 billion and $16 billion - would comprise the $50 billion in tariffs that Trump announced in May, citing China's alleged theft of intellectual property, forced technology transfer and other industrial policies that favor China's domestic businesses and hurt US firms.

"There's areas where China has very competitive technologies that maybe we're collaborating on and the Chinese may say we'll do it with the Europe or Japanese or go it alone". United States stocks rose and the dollar extended losses.

It is now the "largest trade war in economic history". China had lodged a case with the World Trade Organisation (WTO) against the United States, its commerce ministry said in a one-line statement late on Friday.

Imports of semiconductor-dense products like televisions and smartphones so far have mostly been spared by Trump, but they could be hit if the trade dispute grows. "And it's making American companies less competitive", Gonzalez said. These would hit USA energy exports, such as coal and crude oil, among other areas.

A new analysis shows MI is among the most vulnerable to be wounded in a trade war.

China is the biggest buyer of USA soybeans, importing more than $12.4 billion worth of the oil seed in 2017.

Trump has taken an aggressive stance on trade, fulfilling a campaign promise.

Among other energy products, China noticeably spared US liquefied natural gas (LNG) exports from potential import tariffs, but in doing so, it has preserved a potential weapon should the trade war with Washington deepen.

Throughout the escalating conflict, China has sought to take the high road, positioning itself as a champion of free trade, but state media ramped-up criticism of Trump on Friday.

Beijing has made the semiconductor sector a key priority under its "Made in China 2025" strategy, which has intensified after a USA ban on sales to Chinese phone maker ZTE Corp (000063.SZ) underscored China's lack of domestic chips.

"Whether it's through trade war or other means, the end goal is to make China subservient to the United States, " said He Weiwen, vice president of the Center for China and Globalization, in Beijing.

"Millions of American jobs depend on America's ability to trade with other countries", the chamber said in a recent statement. Officials in Beijing reject accusations of theft and say foreign companies have no obligation to hand over technology.