China Retaliates with Tariff Hike on $60B of US Products

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FILE – In this June 8, 2018, file photo, Chinese workers on a suspended platform clean window of an office building against the scenic of Central Business District in Beijing. China has promised retaliation if Washington goes ahead with more tariff hikes, raising the risk Beijing might target operations of American companies if it runs […]

HONG KONG (CNN) – China fired back Tuesday with a tariff hike on $60B of U.S. products after President Donald Trump ramped up the trade war with his biggest wave of tariffs yet.

The Chinese Commerce Ministry had said Tuesday that it would take “countermeasures” in retaliation for the Trump administration’s announcement that it will impose new tariffs on $200 billion worth of Chinese goods, starting at a rate of 10 percent and rising to 25 percent at the end of the year. The new tariffs will affect thousands of products, ranging from food seasonings and baseball gloves to network routers and industrial machinery parts.

The latest clash deepens the conflict between the world’s top two economies that is already hurting companies on both sides of the Pacific. The latest U.S. move means roughly half of the products that China sells to the United States each year will be hit by American tariffs.

Beijing didn’t give details Tuesday of how it would strike back, but it said its countermeasures would be introduced “at the same time” as the U.S. levies. It had previously threatened to impose tariffs of between 5 percent and 25 percent on U.S. products worth $60 billion — including meat, coffee, furniture and auto parts — if the Trump administration went ahead with its plan to target $200 billion of Chinese goods.

China has already gone blow for blow with the United States on tariffs on more than $50 billion of each other’s goods this year.

The White House warned Monday that it would respond to any further retaliation from Beijing with tariffs on roughly $267 billion of Chinese exports.

Uncertainty over trade talks
The two economic superpowers had been preparing to hold a new round of talks this month. It’s unclear whether those will now take place.

A Chinese Foreign Ministry spokesman said Tuesday that Trump’s latest tariff salvo “has brought uncertainty” to the planned negotiations, but he stopped short of saying that Beijing was pulling out.

“The Chinese side has repeatedly emphasized that the only correct way to solve the trade dispute between China and the United States is through talk and consultation on the basis of equity, integrity and mutual respect,” spokesman Geng Shuang said at a regular news briefing. “But what the U.S. side has done doesn’t show sincerity or goodwill.”

He added that China will announce its “detailed retaliation measures at the proper time.”

The U.S. government’s new 10 percent tariffs will take effect on Sept. 24.

Ahead of Trump’s tariff announcement late Monday, top White House economic adviser Larry Kudlow said the United States was still willing to continue its dialogue with China.

“We stand ready to negotiate with China aytime, if they are willing to engage in serious talks,” Kudlow said at the Economic Club of New York.

Several previous rounds of talks between the two sides have failed to make progress. Analysts are skeptical China will be willing or able to do enough to satisfy the Trump administration on some of its key concerns, including Chinese efforts to get hold of U.S. technology and Beijing’s ambitious industrial policies.

“The principal objective of the tariffs is probably not to bring Beijing to the bargaining table,” Arthur Kroeber, a senior analyst at research firm Gavekal said in a note Tuesday. “Rather, it is to force U.S. multinational companies to pull back their investments in China, so that the interdependence of the two rival economies is reduced.”

“Against this aim,” he added, “no possible offer by China can cause the tariffs to be lifted.”

— Serenitie Wang, Yong Xiong, Donna Borak, Katie Lobosco and Kevin Liptak contributed to this report.

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