The United States is also set to impose 25% tariffs on another $16 billion in Chinese exports later in the summer, and China has vowed to retaliate against U.S. goods worth a similar amount.
Have US trade partners retaliated?
Profit forecasts that include a potential tariff impact will perhaps even overshadow second-quarter earnings growth, which analysts say could equal or surpass the first-quarter’s 26.6% year-over-year increase. The US trade deficit in goods with China ballooned to a record US$375.2 billion a year ago, stoking his ire.
“Chinese spending on travel and education in the United States is similar in size to its spending on U.S. soybeans and aircraft – the two largest goods purchases”, said Williams.
China retaliated by imposing a similar 25% tariff on 545 USA products – including cars, soya beans and lobsters – also worth a total of $34bn. According to The Hill, Slater said, “These tariffs target the vital parts and components used in equipment manufacturing throughout the U.S. They also will drive up the cost of manufacturing in the U.S. and risk numerous 1.3 million good-paying manufacturing jobs our industry supports”. “We should be working with our allies to isolate China rather than escalate a trade war”, said Senator Jerry Moran, who represents the agriculture-heavy state of Kansas. Say an American retailer buys 100 garden umbrellas from China for $5 apiece, or $500.
The first ever United States tariffs aimed just at China will likely rally Trump’s voters who agree with his “America First” argument that Beijing hasn’t played fair for years, stealing America’s intellectual property and undercutting its manufacturers.
“Our view is that trade war is never a solution”, Chinese Premier Li Keqiang told reporters in the Bulgarian capital Sofia, after meeting his counterpart.
“The US has said that it is prepared to put traffis on hundreds of billions of dollars of more goods and China has said it will match that”, he added.
Mr. Trump’s aggressive stance toward China is aimed at pressuring the country to curtail what the White House describes as a pattern of unfair trade practices and theft of American intellectual property.
This will be affected by how high individual tariffs are, and also if they are expanded to other countries like Canada, Mexico and the European Union.
Higher product prices boosted by additional tariffs will force Chinese and U.S.consumers and companies to shrink their consumption and investments. “But what’s happened increasingly, is suddenly it became much, much more hard for pork to clear customs and that becomes very expensive – especially with a perishable product, which can spoil in the port if its not kept in the right refrigeration condition”. The products, sold on Chinese e-commerce platforms, ranged from pet food to mixed nuts and whiskey. However, German automaker BMW said it is unable to “completely absorb” new Chinese tariff on imported US-made models and will raise prices. “We can expect job losses and a decline in investor and consumer confidence”, longtime Beijing-based attorney James Zimmerman tells NPR’s Rob Schmitz. However, investors said a significant escalation intention would cause worries to set in.
In the United States, tariffs – also called duties or levies – are collected by Customs and Border Protection agents at 328 ports of entry across the country.
The lists of goods to be hit by tariffs have been updated several times by both administrations.
“If the United States starts imposing additional tariffs, it will actually be charging taxes on firms both in China and around the world, as well as American companies”, Ministry of Commerce spokesperson Gao Feng said at a press conference on Thursday. Meanwhile, some of the officials who previously worked for the Obama administration – known as “holdovers” – are hoping to tamp down the US-China conflict.
Trump on Friday slapped tariffs on $34 billion in Chinese imports, and Beijing fired back by taxing an equal amount of US products.