U.S., China hike tariffs as trade war intensifies

Lloyd Doyle
September 25, 2018

Secretary of State Mike Pompeo vowed that the United States would emerge victorious in an intensifying trade war with China, a day before Washington imposes $200 billion (R2 863 300 000 000,00) worth of tariffs.

This latest round of tariffs is the latest escalation of the mounting trade conflict between the world's two largest economies.

Chinese products hit with fresh U.S. duties include everything from vacuum cleaners to internet-enabled devices, while USA goods targeted by China include liquefied natural gas and certain types of aircraft.

In a white paper, published Monday, China said the USA was applying "extreme pressure" on Beijing to push forward its own interests, while pursuing "economic hegemony". One of the reasons that China chose to cut off talks, according to reports, was the US State Department's crackdown on China's defence agency for purchasing goods from a sanctioned Russian arms exporter. Modems, routers, and switching and networking gear have not been exempted from this latest round of tariffs, a move that will hurt consumers, as the U.S. Customs and Border Control agency will not draw a distinction between equipment meant for consumer use and that meant for commercial use.

The report by the Chinese government said: "It has brazenly preached unilateralism, protectionism and economic hegemony, making false accusations against many countries and regions, particularly China".

Earlier this month, President Donald Trump threatened more tariffs on Chinese goods - another $267 billion worth of duties that would cover virtually all the goods China imports to the United States.

Hopes for talks to resolve the issue appeared to have been dealt a blow as the Wall Street Journal reported Beijing canceled the visit of a negotiating team expected on Thursday and Friday in Washington.

After accusing the U.S. of launching the "largest trade war in economic history", analysts worry Beijing could shift to threatened "qualitative" retaliatory measures, such as damaging USA firms in China or restricting the export of crucial items to the US.

But officials say Beijing will soon run out of United States goods to impose tariffs on.

Speaking to Fox news on Sunday, he said: "To the extent one wants to call this a trade war, we are determined to win it".

China summoned the U.S. ambassador in Beijing and postponed joint military talks in protest against a USA decision to sanction a Chinese military agency and its director for buying Russian fighter jets and a surface-to-air missile system.

"The trade war is now a reality", Fitch chief economist Brian Coulton said in the release.

"It would look weak both to the USA and at home", he said, adding that there is "sufficient stimulus in the pipeline" to limit the damage of the latest tariffs on China's economy.

China may also be waiting for U.S. mid-term elections early next month for any hints of changes in Washington's policy stance, Carnell added.

"With generic polls favouring the Democrats, they may feel that the trade environment will be less hostile after November 6".

China imports far less from the United States, making a dollar-for-dollar match on any new USA tariffs impossible. Instead, it has warned of "qualitative" measures to retaliate. It includes many food products, including seafood.

Other reports by Iphone Fresh

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