China to retaliate after U.S. imposes tariffs on $50 billion in imports

Ivan Schwartz
June 16, 2018

On March 1, the Trump administration announced a global 25 percent tariff on all steel imports and a 10 percent global tariff on all aluminum imports.

"It has also seriously damaged China's legitimate rights and interests and has harmed the interests of China and its people, " Xinhua reported. The two sides had said in a joint statement that China would "significantly increase" purchases of United States agricultural and energy products to reduce the trade imbalance, a top Trump demand. "Those are crown jewels for this country", the president said.

Trump has vowed to fulfill his campaign pledge to crack down on what he contends are China's unfair trade practices and efforts to undermine U.S. technology and intellectual property.

The Office of the U.S. Trade Representative said the tariffs will start on July 6. "All the results from the negotiations previously reached by the two parties will be invalid".

The tariffs underscore the tension between China and United States over trade negotiations, a back-and-forth that somehow roped in Chinese smartphone maker ZTE.

In Beijing on Friday, Chinese foreign ministry spokesman Geng Shuang repeated earlier warnings that all trade talks between China and the USA would be void if Washington imposed trade sanctions.

U.S. President Donald Trump speaks during a news conference after his meeting with North Korean leader Kim Jong Un at the Capella Hotel on Sentosa island in Singapore June 12, 2018. "There is still more work to be done by China and the United States to get to the ultimate outcome".

The tariffs target mainly Chinese industrial machinery, aerospace parts and communications technology, while sparing such consumer goods as smartphones, TVs, toys and clothes that Americans purchase by the truckload from China.

China responded to USA tariffs announced Friday morning with a promise to impose reciprocal levies on a range of American products, including agricultural products, cars and seafood.

"We made clear in this statement that all economic and trade outcomes of the talks will not take effect if the USA side imposes any trade sanctions, including raising tariffs", Geng said.

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The US wants China to stop practices that allegedly encourage transfer of intellectual property - design and product ideas - to Chinese companies, such as requirements that foreign firms share ownership with local partners to access the Chinese market.

But that amount is still significant and all but guaranteed to provoke a response form Beijing, which has its own tariff target list of $50 billion in US goods, including soybeans, beef and cars.

The USTR announced a second list of 284 goods valued at US$16 billion that will be subject to review and public comment before the penalties take effect.

China, the world's second-largest economy, has pledged to retaliate against United States exports including soybeans and pork.

China called on all countries to take action against the US' "outdated and regressive behaviour".

After talks in Beijing and Washington, a preliminary deal was struck that appeared to put the trade restrictions on hold.

America's trade in goods with China topped $635 billion in 2017, according to the U.S. Census Bureau.

The administration initially said that up to 1,300 products could be hit with the tariffs, which American importers pay and pass on to their customers.

"The president's trade team has recommended tariffs".

And he warned that any retaliation by Beijing would trigger another round of tariffs on Chinese goods.

Other reports by GizPress

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