Published: Sun, June 17, 2018
Markets | By Noel Gibbs

Trump administration announces tariffs on $50B in China imports

Trump administration announces tariffs on $50B in China imports

Responding to US President Donald Trump's decision to impose tariffs on $50 billion worth of Chinese imports, Beijing has adopted a 25 percent tariff on 659 American products worth the same amount.

"These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs", Trump said in a statement issued by the White House.

"We will immediately launch tariff measures that will match the scale and intensity of those launched by the United States", the ministry promised, adding that "all economic and trade agreements reached by previous negotiations will be nullified at the same time".

The new US tariffs, which target almost 1,100 Chinese goods (mostly advanced industrial products), are meant to punish China for stealing USA intellectual property and other unfair trade practices.

Since the U.S. -China trade dispute started in March, U.S. soybean prices have fallen about 12 percent.

The productivity and robust sales of American agricultural products leave them in the cross hairs of anyone trying to gain leverage against the U.S. China has said it will retaliate with $50 billion in tariffs, rattling financial markets.

USA agricultural products, fish and automobiles worth some $34 billion worth of U.S. goods will kick in on July 6, with another $16 billion worth of products subject to the 25 percent duty at a later date, Xinhua reported citing the Tariff Commission of the State Council.

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"The Chinese side firmly opposes that", it said. China said it wants to place new duties on items such as farm products, autos and seafood starting on July 6.

That raises the specter of an intensifying trade war, which would hurt consumers, companies and the global economy.

Top among American products hit with duties by China are agricultural exports, with soybeans, sorghum, oranges, pork, poultry and beef included in the Dollars 34 billion in goods targeted for higher border taxes starting next month.

Trump's tariffs did gain some support from an unlikely source, U.S. Senate Democratic leader Charles Schumer, who called them "right on target".

The Trump administration has identified multiple ways Beijing steals USA technology and undermines US access to the Chinese market, which are the basis for the new tariffs.

Thomas Donohue is president of the U.S. Chamber of Commerce.

Trump said more tariffs on Chinese goods could come if the Chinese government retaliates.

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Friday's list of goods on which China is to impose tariffs is longer than an initial list of 106 published on April 4, but their total value remains unchanged, at $50 billion.

In fact, China's other trading partners like - Europe, Japan and few others, have also expressed similar concerns, but Trump has been unusually direct about challenging Beijing and threatening to disrupt such a large volume of exports.

Beijing also has announced plans to cut import duties on autos and some consumer goods and to ease limits on foreign ownership in auto manufacturing, insurance and some other industries, though those don't directly address US complaints.

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"China's Government is aggressively working to undermine America's high-tech industries and our economic leadership through unfair trade practices and industrial policies like "Made in China 2025".

Analysts at Capital Economics said the impact of the tariffs on China's economy would be small.

USA officials say the tariff hike targets goods that might benefit from Chinese theft of technology or pressure on foreign companies to hand it over in exchange for market access.

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