The US yesterday hiked tariffs on Chinese imports and Beijing announced that it was retaliating against US goods in a technology dispute between the world’s two biggest economies that US President Donald Trump has said he is prepared to escalate.
Washington imposed 25 percent tariffs on US$34 billion of Chinese imports, a first step in what could become an accelerating series of tariffs.
Retaliatory measures “took effect immediately,” Chinese Ministry of Foreign Affairs spokesman Lu Kang (陸慷) said.
Photo: EPA-EFE
Lu provided no details, but the Chinese Communist Party-run People’s Daily said the Chinese General Administration of Customs was carrying out a plan announced last month to impose 25 percent tariffs on a US$34 billion list of US goods, including soybeans, pork and electric cars.
Companies worry that the spiraling dispute could chill global economic growth, but Asian financial markets took yesterday’s developments in stride.
Japan’s main stock index, the Nikkei 225, gained 1.1 percent, while the Shanghai Composite Index added 0.5 percent and Hong Kong’s Hang Seng rose 0.8 percent.
Trump on Thursday said higher tariffs on an additional US$16 billion of Chinese goods were set to take effect in two weeks.
After that, the hostilities could intensify: Trump said the US is ready to target an additional US$200 billion of Chinese imports — and then US$300 billion more — if Beijing does not yield to US demands and continues to retaliate.
That could bring the total of targeted Chinese goods to US$550 billion — more than the US$506 billion in goods that China shipped to the US last year.
The Trump administration has contended that China has deployed predatory tactics in a push to overtake US technological dominance, including cybertheft and requiring US companies to hand over technology in exchange for access to China’s market.
Chinese officials have rejected the accusations of theft and said no foreign company is obligated to share technology.
However, rules on auto manufacturing and other industries require companies to work through state-owned partners, which forces them to share know-how with potential competitors.
Trump has “ignited the biggest trade war in economic history,” the Chinese Ministry of Commerce said.
“The United States has blatantly violated WTO rules,” Lu said. “Any unilateral pressure will be futile.”
Washington has also strained relations with potential allies in its dispute with Beijing by raising import duties on steel, aluminum and cars from Europe, Canada, Mexico and Japan.
The state-run China Daily accused the Trump administration of “behaving like a gang of hoodlums,” saying that they would damage the global economy unless other countries stop them.
“There should be no doubting Beijing’s resolve,” the China Daily said.
“A trade war benefits no one, because it hurts free trade and the multilateral process,” Chinese Prime Minister Li Keqiang (李克強) told a summit with 16 EU and Balkan countries in Sofia.
“If a country wants to raise tariffs, China will respond to defend itself,” he said.
Additional reporting by AFP
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