China announced Wednesday it plans to impose tariffs on $50 billion worth of U.S. goods in response to a similar package announced by the United States.
The Chinese measures would boost tariffs by 25 percent on 106 U.S. products, including soybeans, aircraft and cars.
China’s commerce ministry responded with its own measures less than 11 hours after the U.S. issued a proposed list of Chinese goods. The ministry said the question of when the measures will go into effect will depend on when the U.S. tariffs become active.
U.S. President Donald Trump announced his intention to impose $50 billion in increased tariffs on Chinese products last month, and on Tuesday the U.S. Trade Representative released a proposed list of 1,300 goods including aerospace, medical and information technology products.
Subject to public review
That list will be subject to a public review process scheduled to run until late May.
“The total value of imports subject to the tariff increases is commensurate with an economic analysis of the harm caused by China’s unreasonable technology policies to the U.S. economy,” the USTR said.
The United States has accused China of pressuring foreign companies to hand over technology.
China’s Vice Minister of Commerce Wang Shouwen said Wednesday that accusation is groundless, and that while China wants to resolve the trade dispute through dialogue, if the United States continues the fight then China will too.
Unlike the U.S. list, which includes many obscure industrial goods, China’s list targets cotton, frozen beef, soybeans and other agricultural products that are produced in states from Iowa to Texas that favored Trump in the 2016 presidential election.
The U.S.-China dispute has fueled concern it could stymie a global economic recovery if other countries raise their own import barriers.
The prospect of a trade war between the world’s two largest economies also has worried stock market investors. U.S. markets opened sharply lower Wednesday. Shortly after the markets opened, the S&P 500 Index fell 1.4 percent, the Dow Jones Industrial Average dropped 1.8 percent and the NASDAQ Composite Index was 1.6 percent lower.
Trump, however, dismissed the notion of a U.S.-China trade war on Wednesday, tweeting that previous U.S. administrations weakened the country’s ability to defend itself on trade matters.
“We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!”
In a subsequent tweet Trump seemed to imply the U.S.-China trade imbalance is so wide that there is only room for improvement.
“When you’re already $500 Billion DOWN, you can’t lose!”
Despite Trump’s claims, U.S. government figures show the U.S. had a $375 billion trade deficit with China at the end of 2017.
U.S. Commerce Secretary Wilbur Ross also dismissed concerns Wednesday about a burgeoning trade war with China and said recent trade actions between the two countries would probably lead to a negotiated agreement.
“It wouldn’t be surprising at all if the net outcome of all this is some sort of negotiation,” Ross said in an interview with CNBC.
Ross brushed off worries of a trade dispute, saying U.S. tariffs imposed on China amount to only 0.3 percent of America’s gross domestic product.
China’s Vice Minister of Commerce Wang Shouwen said Wednesday that accusation is groundless, and that while China wants to resolve the trade dispute through dialogue, if the United States continues the fight then China will too.your ad here