Trump Tariffs Against China Take Effect

Trump Tariffs Against China Take Effect

Trump Tariffs Against China Take Effect

Global stock markets managed small gains Friday, overcoming earlier wobbles prompted by China and the United States firing opening salvos in a trade war that pits the world's two biggest economies against each other.

A commodities trader in eastern Shandong province was told by customs at a major northern port that they have slowed the clearance of goods from the United States on Beijing's list.

China's Commerce Ministry, in a statement shortly after the U.S. deadline passed at 4.01am GMT on Friday, said that it was forced to hit back, meaning $34bn worth of imported U.S. goods, including autos and agricultural products also faced 25% tariffs.

Investors fretted about the escalating trade battle between the world's two largest economies during Tuesday's abbreviated trading session.

"If what the USA wants is to escalate a trade war with China, then so be it. A little fighting may be the only way the Trump administration clears its mind and allows everyone to sober up", the state-run Global Times said.

The Trump administration is "behaving like a gang of hoodlums", it says.

Ahead of the planned tariffs, China said that the "US is opening fire on the entire world, including itself".

"In response to the U.S. announcement to impose additional duties on Chinese imports, the Customs Tariff Commission of the State Council announced it would levy additional tariffs for 545 items worth about $34 billion, including agricultural products, vehicles and aquatic products, starting July 6, 2018". Chinese manufacturers have already been hit by a strengthening yuan that has made exports more expensive.

"One of the biggest competitive advantages of Chinese exports is their low price".

Washington has said it would implement tariffs on $34 billion of Chinese imports on July 6, and Beijing has vowed to retaliate in kind on the same day though it has said it will not be the first to pull the trigger.

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"Although uncertainties have clearly increased this year and pose downside risks to growth, the latest batch of timely activity indicators suggests that in the shorter term the global economy is resilient to these worries", Ben May, director of global macro research at Oxford Economics in London, said in a report on Thursday.

"[The US has started the] largest trade war in economic history".

Trump confirmed that the United States would begin collecting tariffs on $34 billion in Chinese goods at 12:01 a.m. (0401 GMT) on Friday and warned that subsequent rounds could exceed $500 billion - roughly the amount that the United States imported from China previous year.

"You have another 16 [billion dollars] in two weeks, and then, as you know, we have $200 billion in abeyance and then after the $200 billion, we have $300 billion in abeyance. OK?"

Mr Trump has railed against Beijing for intellectual property theft and barriers to entry for United States businesses and a $375 billion U.S. trade deficit with China.

There was no evidence of any last-minute negotiations between U.S. and Chinese officials, business sources in Washington and Beijing said.

Trump's tariffs are the result of an investigation by the administration into the theft of USA intellectual property by Chinese firms and their government. -China economic relationship had grown "no longer sustainable".

Beijing has made the semiconductor sector a key priority under its "Made in China 2025" strategy, which has intensified after a us ban on sales to Chinese phone maker ZTE Corp (000063.SZ) underscored China's lack of domestic chips.

The Washington Post reported on Wednesday that United States companies had already felt Beijing's sting "in the form of stalled product approvals, worker visas and licensing applications".

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