Wednesday, 18 July, 2018

Donald Trump hits China with $200 billion in new tariffs

Shipping containers are seen at a port in Shanghai US Releases $200bn List Of Chinese Products For Possible New Tariffs
Nellie Chapman | 12 July, 2018, 03:27

The United States late Tuesday announced it was starting the process to slap 10 percent tariffs on another $200 billion in Chinese export goods as soon as September, escalating the trade war between the world's two largest economies.

Chinese officials are expected to retaliate in other ways, hitting USA firms in China with unplanned inspections, delays in approving financial transactions and other administrative headaches.

The products include various food items, chemicals, minerals, tobacco, electronics and office goods. This has raised concerns that China could retaliate with non-tariff trade measures.

"The Chinese side is shocked by the actions of the USA", it said in a statement, according to a translation by Google.

The Trump administration intends to impose a ten percent duty on the products listed, Reuters reported, citing US Trade Representative Robert Lighthizer.

Stocks began to be traded lower today as a trade war between the U.S. and the other major economies became a reality after President Donald Trump unveiled new tariffs on Chinese goods.

Market drops started in Asia overnight, where all of China and Hong Kong's share indices lost more than 1%, and has spread to Europe as markets open here.

At 11.30 pm IST, the Dow Jones Industrial Average was down 141.78 points, or 0.57 per cent, at 24,777.88, while the S&P 500 was down 11.70 points, or 0.42 per cent, at 2,782.14. Traders said they were keeping an eye on the key 6.7 per dollar level as pressure mounted on the currency.

The new list published on Tuesday targets many more consumer goods than those covered under the tariffs imposed last week, raising the direct threat to consumers and retail firms and increasing the stakes for lawmakers in Trump's Republican party facing elections in November.

Senate Finance Committee Chairman Orrin Hatch, of Utah, called the new levies "reckless" and not "targeted".

"Tariffs on such a broad scope of products make it inconceivable that American consumers will dodge this tax increase as prices of everyday products will be forced to rise", David French, the group's senior vice president for government relations, said in a statement. Proposed tariffs on another US$200 billion of Chinese imports have been rolled out with Beijing vowing to retaliate.

Trump has been considering tariffs against China since his officials concluded in March that Beijing violates U.S. intellectual-property rights, such as by forcing American firms to hand over technology.

"American families are the ones being punished".

The latest escalation in the trade dispute sent markets lower.

"This is an appropriate response under the authority of Section 301 to obtain the elimination of China's harmful industrial policies", Lighthizer added.

The market slide may have been contained in part by speculation the Trump administration could change its mind by the end of August, when the tariffs are due to come into effect, some strategists said.

After the list was released, China's Commerce Ministry said in a statement that it could not accept the additional tariffs proposed by the United States, adding that it was "shocked" by the decision.