China says forced to react after USA launches ‘largest trade war’

China says forced to react after USA launches ‘largest trade war’

China says forced to react after USA launches ‘largest trade war’

The United States imposed $34 billion in tariffs on Chinese products Friday, and Beijing hit back with its own fiscal punishment and slammed the Trump administration for igniting "the biggest trade war in economic history".

And Trump said Thursday that higher tariffs on an additional $16 billion of Chinese goods are coming in the next two weeks, setting up what could be a tariff on $550 billion worth of goods - more than the $506 billion in Chinese imports a year ago.

"You have another 16 (billion USA dollars) in two weeks, and then, as you know, we have US$200 billion in abeyance, and then after the US$200 billion, we have US$300 billion in abeyance". The principles underlying the trade policies of New Delhi and President Trump unfortunately are similar - and they are both wrong.

"I've watched for too many years. how we always end up taking the brunt of most trade deals", he said.

The US tariffs target a wide range of Chinese goods- including aircraft parts and computer hard drives- that Washington says have benefited from unfair trade practices. "It seriously jeopardizes the global industrial chain, ... hinders the pace of global economic recovery, triggers global market turmoil and will affect more innocent multinational companies, general companies and consumers".

Given the moves were widely telegraphed, investors took them in stride.

Spurned, China dug in its heels, and so did the U.S.

Non-frozen orange juice will also be hit with export tariffs.

Trump has chosen to wage a trade war without fully understanding the nature of global trade. The extent of the economic damage will depend on how far both sides go.

The president believes this is the best way to close the trade deficit between the U.S. and China.

The trade war may have just started, but China has already been making moves in the soybean world as USA shipments originally destined for the nation have been canceled or rerouted. The Chinese are likely to take a more nationalistic view, as compared to Americans, of the suffering caused by a trade war.

Analysts said such a trade war would disrupt global supply chains and raise prices for consumers worldwide.

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Companies seeking product exclusions from tariffs on Chinese goods imported into the United States will get 90 days to file such requests, the U.S. Trade Representative's office said on Friday.

Retaliatory measures "took effect immediately", said a Chinese foreign ministry spokesman, Lu Kang.

De Bolle predicts China could delay USA imports at customs or dial up currency manipulation.

States won by President Donald Trump in the 2016 election stand to lose the most as a trade war between the USA and China kicks off, according to Citigroup research.

The factory, situated in eastern Zhejiang province, had also made flags for the election campaigns of Hillary Clinton and Trump in 2016, the Washington-based National Public Radio reported. The damage could also spread to other economies, hurting business confidence and prompting companies to delay investments.

Terming the manufacturing of flags for Trump's 2020 bid as "completely normal", he said, "That is trade".

Local customs at the port of Qingdao have let through American products they held up on Friday, and imposed higher tariffs on the goods, according to a trader briefed by a customs official at the port.

While the initial volley of tariffs was not expected to have a major immediate economic impact, the fear is that a prolonged battle would disrupt makers and importers of affected goods in a blow to global trade, investment and growth.

Japan's main stock index, the Nikkei 225, gained 1.1 percent while the Shanghai Composite Index added 0.5 percent. The effect on the United States will be less. The S&P 500 rose to a two-week high on Friday, partly buoyed by strong growth.

Asia is bracing for the opening salvo in a tit-for-tat trade battle, with the U.S. due to impose 25% tariffs on $34bn of Chinese goods on Friday.

China lodged a case with the World Trade Organisation (WTO) against the United States, its commerce ministry said on Friday.

American apple growers are also concerned about the new export tariffs. And the impact would be roughly double in 2019.

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