Trump imposes 25 per cent duties on $50bn worth of Chinese goods

  • Trump imposes 25 per cent duties on $50bn worth of Chinese goods

Trump imposes 25 per cent duties on $50bn worth of Chinese goods

US President Donald Trump Friday announced tariffs of 25 percent targeting tens of billions in Chinese imports, sparking immediate retaliation from Beijing and bringing the world's two largest economies to the brink of an all-out trade war feared by markets and industry.

Trump kicked off the action in March with the announcement that the USA would impose tariffs on Chinese goods as punishment for the theft of USA intellectual property by China.

In May, Chinese officials had promised to buy more American farm goods, natural gas and other products to narrow China's large trade surplus with the United States.

China said Friday it is retaliating against USA tariffs by imposing penalties on the same scale against the United States.

The Trump administration's China tariffs spared some finished goods like smartphones and washing machines, while charges on parts and components could drive up costs in the USA supply chain.

Within hours of the White House's announcement, the Chinese government issued a statement threatening to "immediately introduce taxation measures of the same scale and the same strength", CNBC reports.

Businesses in both countries, but especially the United States, are growing increasingly concerned that the dispute could escalate further and chill global economic growth.

Aircraft, included in the earlier Chinese list, were not on the revised list. The ministry announced Friday that it will immediately add tariffs of "equal scale and equal strength" on US products.

U.S. Trade Representative Robert Lighthizer said the punitive duties will apply on 818 Chinese products valued at $34 billion starting July 6.

Trump has long threatened to impose tariffs on Chinese as part of his protectionist policies and to halt the ascendancy of what he considers to be America's greatest economic rival. The tariffs have increased chances of a full-blown global trade war as the European Union and Canada have voted to retaliate against USA metal tariffs.

China's Commerce Ministry answered quickly to the USA taxes on Chinese imports.

State-controlled media made a concerted attack on the new USA measures.

Trump's announcement is an escalation of a long-simmering trade battle between the two countries.

Companies and trade groups in the USA and China have expressed concern over how the escalating trade spat between the world's two biggest economies could affect operations.

For example, both Singapore and Chinese Hong Kong impose virtually no tariffs or trade restrictions on other countries, according to the WTO.

The Chinese government said it would respond in kind to the United States tariffs, which will apply to roughly 1,100 exports and will target China's aerospace, robotics, manufacturing and auto industries.

Those restrictions are aimed at stopping China from developing its own hi-tech industry with technologies acquired from the United States - one of Washington's long-standing complaints.

"It is deeply regrettable that in disregard of the consensus between the two sides, the USA has demonstrated flip-flops and ignited a trade war", the ministry said.

Businesspeople and economists say Chinese leaders are less likely to compromise on technology.

"While the end game is a compromise trade deal that meets US demands for stronger Chinese protection of intellectual property rights, the road to a trade deal has become very ugly", said Rajiv Biswas, APAC chief economist at IHS Markit in Singapore. "Those are crown jewels for this country", Trump said.