United States to impose tariffs on $200 billion Chinese imports

United States to impose tariffs on $200 billion Chinese imports

United States to impose tariffs on $200 billion Chinese imports

China on Wednesday (July 11) vowed to take "countermeasures" after the United States said it would slap 10 per cent tariffs on an extra US$200 billion worth of Chinese imports.

The new list is a retaliatory measure following China's own retaliatory tariffs the country announced after the USA unleashed its initial $34 billion in tariffs last week.

The US administration on Friday imposed 25% duties on Chinese imports worth $34 billion (Rs 23,454 crore) after threatening to do so for months.

The products include various food items, chemicals, minerals, tobacco, electronics and office goods.

The National Retail Federation, an industry group, warned about the impact on prices from the new measures.

"The behaviour of the United States is hurting China, hurting the world and hurting itself", a spokesperson for China's commerce ministry said in a statement.

US Senate Finance Committee Chairman Orrin Hatch described the move was "reckless".

US Trade Representative Robert Lighthizer writes that these new tariffs come as a response to how Beijing retaliated to the initial tariffs - quickly implementing matching tariffs on the same amount of US exports to China. The U.S. has now listed another 170 bn euros ($200bn) worth of tariffs on more products that are due to go into force in September.

In a written statement, the trade ministry said Seoul has already reflected USA demands in the auto sector in the recently revised bilateral trade deal and Korean automakers contribute to the USA economy by manufacturing cars in their American factories.

Experts have said that the outlook of the trade war depends on how China responds to the tariffs on its imports.

"The internal political dynamics in both countries make it unlikely that either side will stand down and offer conciliatory measures that could deescalate tensions and lead to a resumption of negotiations", Eswar Prasad, a professor of trade policy at Cornell University, said in an email. The prospect of an global trade war has sent jitters through world markets.

The news, first reported by Bloomberg in early Asian trade when the currency market's liquidity falls to the lowest levels of the day, prompted knee-jerk selling of riskier assets against less vulnerable currencies.

The trade official says the list created by the European Union was "drafted on the basis of several parameters, including its capacity to induce policy change in the United States".

"China has no option but to fight fire with fire. But more tariffs like these will punish America's manufacturing workers - and could undermine our hard-won gains thanks to tax and regulatory reform". As Trump put it back in June (via Twitter): "China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology".

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