[UPDATE: 22:00] China has announced that it will institute tariffs on $60 billion of US imports. It’s not clear if other measures will follow.
Earlier this summer, Beijing hit back against Trump’s first round of tariffs on $50 billion of Chinese imports by simply responding in kind. However, it won’t be able to do that this time around. Last year, China imported just $130 billion of goods from the US, leaving Beijing with now only around $80 billion of imports to work with, but Trump’s latest move will see 10 percent tariffs slapped on $200 billion of Chinese imports.
China could respond by imposing higher tariffs on US goods, or it could look into other ways of hurting the US economy.
Trump has promised that if China does retaliate, then he will not hesitate to slap tariffs on an additional $267 billion of Chinese goods. That would mean tariffs on virtually all of the Chinese goods that the US buys.
Tariffs have put the U.S. in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country – and yet cost increases have thus far been almost unnoticeable. If countries will not make fair deals with us, they will be “Tariffed!”
— Donald J. Trump (@realDonaldTrump) September 17, 2018
Despite this threat, China’s commerce ministry said today that it had no choice but to retaliate against US trade tariffs, adding that it hopes the US will realize the negative consequences of its actions and correct its behavior.
Meanwhile, China foreign ministry spokesman Geng Shuang has accused the US of bringing “new uncertainty” to trade talks between the world’s two largest economies.
“China has always emphasized that the only correct way to resolve the China-US trade issue is via talks and consultations held on an equal, sincere and mutually respectful basis,” Geng said. “But at this time, everything the United States does not give the impression of sincerity or goodwill.”
So far, the US-China trade talks have led nowhere and neither side appears willing to back down. At an Alibaba investor conference in Shanghai earlier today, Jack Ma warned that a trade war between the two countries could last for 20 years.