Saturday, 15 December, 2018

Farmers concerned about how trade war will affect profits

Relations have soured between US President Donald Trump’s administration and that of Chinese President Xi Jinping since they met in Beijing last year sparking fears of an all-out trade war Farmers concerned about how trade war will affect profits
Nellie Chapman | 11 July, 2018, 21:51

The tariffs will hurt the American high-tech companies that Trump is trying to protect from intellectual property theft as it becomes increasingly hard for those companies to do business in China, she said.

"The threat of additional duties comes at a fragile time in the development of the Chinese market for USA beef ... importers and distributors are still at a nascent stage of building sales and distribution channels for US beef", USMEF said.

Beijing also accused Washington of breaching trade rules of the World Trade Organisation (WTO). The administration has placed "these import taxes squarely on the shoulders of manufacturers and by extension consumers", Souhrada said.

Overnight gains in European and US equities, however, provided some comfort for the start of Asian trading. Beijing said it had no choice but to respond in kind, but was yet to outline the full extent of any retaliatory measures.

But Shaun Rein, founder of China Market Research Group and author of the book "The War for China's Wallet", told us he has a different take on this situation.

Substantial they may be, but the average US consumer will likely not see these impacts directly for a little while.

"A rise in trade protectionism would increase global risk aversion and disproportionately affect non-USD countries due to their relative economic openness", analysts at Bank of America Merrill Lynch said in a recent note. "We do not want to fight it, but in order to safeguard the interests of the country and the people, we have no choice but to fight", said Gao Feng, spokesman for China's commerce ministry.

China's tariffs on hundreds of USA goods include top exports such as soybeans, sorghum and cotton, threatening U.S. farmers in states that backed Trump in the 2016 USA election, such as Texas and Iowa.

The U.S. Chamber of Commerce, which has come out against the Trump administration's trade policy, published a state-by-state analysis of what it says the effects of that policy will be.

Still, China's stance is striking given Washington's deep economic and security ties with European nations.

The United States hiked tariffs on Chinese imports Friday and Beijing announced it was retaliating against American goods in a technology dispute between the world's two biggest economies that President Donald Trump says he is prepared to escalate.

"Trump has split the West, and China is seeking to capitalize on that".

The Thomson Reuters/HKEX Global CNH index, which tracks the offshore yuan against a basket of currencies on a daily basis, has lost more than 3 per cent in the past two weeks.

USA light crude futures traded up 0.6 per cent at $74.62 per barrel, after rising above $75 for the first time in more than three years on Tuesday.

The two countries increasingly have engaged in verbal sparring in recent months, but Friday's pair of haymakers has dramatically escalated the trade dispute - and that has investors across the world anxious about what comes next. It said they would damage the global economy unless other countries stop them.

A report by New York-based Rhodium Group, a research consultancy, in April showed that Chinese restrictions on foreign investment are higher in every single sector save real estate, compared to the European Union, while numerous big Chinese takeovers in the bloc would not have been possible for EU companies in China. But EU officials expect any moves to be more symbolic than substantive. "So we have 50 plus 200 plus nearly 300".

Chinese state media on Wednesday kept up a steady drum beat of criticism of the United States.

The European Union is seeking to pass legislation to allow greater scrutiny of foreign investments. "We don't know when that will be".