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US-China Trade War Escalates, Trump Announces Tariffs On $200 Billion In Chinese Goods

DIVYIA ASTHANA | 0
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| September 18 , 2018 , 10:54 IST

Escalating the trade war between the 2 biggest economies of the world, US President Donald Trump on Monday announced additional tariffs of 10 percent on $200 billion in imports from China, threatening to target even more if Beijing retaliates.

The new tariffs would come into effect from September 24, placing punitive duties on nearly half of the products the US buys from China, which is its largest source of imported merchandise. The 10 percent tariffs will continue till the end of the year, after which the rate will increase to 25 percent.  

President Trump in a statement said that China had refused to change the unfair practices which hurt US businesses and workers.

"For months, we have urged China to change these unfair practices and give fair and reciprocal treatment to American companies," Trump said.

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"These practices plainly constitute a grave threat to the long-term health and prosperity of the United States economy," he said.

"But, so far, China has been unwilling to change its practices, including theft and force transfer of technology," said Trump.

"If China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports," he said, which would result in taxes on all the goods imported by the US from China.

"Once again, I urge China's leaders to take swift action to end their country's unfair trade practices," Trump said.

"Hopefully, this trade situation will be resolved, in the end, by myself and President Xi of China, for whom I have great respect and affection," said the US president.

Meanwhile, China's Foreign Ministry has already vowed to strike back.

"If the US launches any new tariff measures, China will have to take countermeasures to firmly ensure our legitimate rights and interests," foreign ministry spokesman Geng Shuang said to media on Monday.

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Since China only bought around $130 billion in U.S. goods last year in comparison to the $506 billion worth bought by US, China would run out of American products to tax before the US would run out of Chinese imports.

Experts view that even if China runs out of American products to tax, it would likely retaliate in other ways, possibly hitting US firms in China with unplanned inspections, delays in approving financial transactions and other administrative hurdles.

The new tariffs would be applicable on products ranging from voice data receivers, computer memory modules, automatic data processors, and accessories for office equipment. The items still off the list include consumer electronics like smart watches and Bluetooth devices, child safety products such as high chairs, car seats and play pens, and certain health-and-safety products such as bicycle helmets.