China retaliates as US slaps tariffs

China Tuesday hit back at the US with tariffs on USD 60 billion worth of American goods, in a tit-for-tat move that came hours after President Donald Trump slapped duties on USD 200 billion worth of Chinese imports.

President Trump on Tuesday slapped 10 per cent tariffs on USD 200 billion worth of Chinese imports and the duties will rise to whopping 25 per cent at the end of the year, escalating the trade war with the world’s second largest economy.

He alleged that China had been unwilling to change its unfair trade practices and the new additional tariff structure would give fair and reciprocal treatment to American firms.

“If the United States insists on raising tariffs even more, China will respond accordingly,” China’s finance ministry said in a statement.

“In order to safeguard our legitimate rights and interests and the global free trade order, China will have to take countermeasures,” the country’s Ministry of Commerce said in a statement, adding that “We deeply regret this“.

The Chinese government said it will hit back with tariffs of up to 10 per cent on an additional USD 60 billion in American goods following Trump’s escalation by slapping higher border taxes on nearly all US exports to China, a media report said.

Earlier, China threatened to retaliate with “synchronised counter measures” against Trump’s third round of tariffs, saying the US’ move will add “new uncertainties” for future talks between the world’s top two economies.

China’s Ministry of Commerce said it would be forced to take “synchronised counter measures” against the new tariffs.

In a statement, the ministry also said that the tariffs announced by Trump had “added new uncertainties” to trade talks between the two sides.

Trump also warned China against any retaliation, saying if Beijing retaliated this time, the US would impose further tariffs on another USD 267 billion worth of products virtually covering almost all Chinese exports to the US totalling about USD 522.9 billion.

According to official figures, US goods and services trade with China totalled an estimated USD 710.4 billion in 2017 of which US exports were USD 187.5 billion and imports were USD 522.9 billion.

Trump has been pressuring China to reduce the trade deficit with the US, totalling to USD 335.4 billion in 2017.

Last month, both sides resumed trade talks but at a lower level.

Chinese Vice Minister of Commerce Wang Shouwen held talks in Washington but without much results.

Trump, who has been demanding that China should reduce trade deficit immediately by USD 100 billion, recently called for talks to resolve the issue.

In Beijing, Chinese Foreign Ministry spokesman Geng Shuang on Tuesday gave no inkling about how China’s plans to retaliate Trump’s new round of tariffs and said it brought more uncertainties to future round of talks.

“I want to say that China has to respond to uphold our legitimate rights and interests, the order of free trade,” Geng told reporters.

“This measure by US side added more uncertainties to the talks between the two sides,” he said.

Asked how the two sides plan to end the trade war, Geng said “We have been stressing that talks need to happen on the basis of equality and good faith so as to resolve the issues between the two sides. What the US has done shows no sincerity, no good faith at all,” he said.

To another question on whether China viewed escalation of tariff war by the US as an attempt to contain Beijing’s rise, Geng said, “regarding containment, I have never heard of that from any US official.

“We have been repeating that sound and steady development of China-US ties serves the fundamental interest of the two sides and what the international community wishes to see“.

Geng said China would like to work with the US to achieve that, adding that “however the protectionist and unilateral measures taken by US were not acceptable to us“.

He also declined to go into specific measures on whether Beijing would contemplate non-trade measures like containing visas to US citizens.

“In the light of the latest round of tariffs, China has to counter act but what kind of counter measures would the Chinese side take will be released in time. You made assumption (about not granting visas), I have no comment on that,” Geng said.

Hong Kong-based ‘South China Morning Post’ reported on Tuesday that China is likely to cancel its tentative plans to send President Xi Jinping’s top economic adviser Liu He to Washington after Trump’s new tariff announcement.

According to the source, who declined to be identified , as the plans have not been made public, China is reviewing its earlier plans to send a delegation, headed by vice-premier Liu He to Washington next week, the report said.

One precondition for the talks was that the Americans would show sufficient goodwill but Trump’s latest decision to escalate the trade war by slapping new tariffs on almost half of all Chinese exports may have scuppered the talks, it quoted the sources as saying.

“If the vice-premier does go to the US, we can reasonably suspect he has a reasonable offer, but at this point, I would think the likelihood is low,” the representative said.

China had earlier retaliated twice by imposing additional tariffs on imported products from the US.