Published: Wed, August 08, 2018
Business | By Pearl Harrison

China Fires Back in Trade War

China Fires Back in Trade War

Chinese state media on Monday lambasted US President Donald Trump's trade policies in an unusually personal attack, seeking to reassure investors who are anxious about China's economy with growth concerns shaking its financial markets.

Late on Friday, China's finance ministry unveiled new sets of additional tariffs on 5,207 goods imported from the United States, with the extra levies ranging from five to 25 percent on a total value of goods less than half of that proposed by U.S. President Donald Trump's administration.

"China's countermeasures with differentiated tariff rates are rational and restrained, and were proposed after extensively soliciting opinions and careful evaluation", the spokesperson said in a statement.

But more worryingly, also included on China's latest list are 189 lines of clothing in both knitted and woven categories imported from the USA, including shirts, trousers, blouses, T-shirts, sweatshirts, pullovers, sportswear, swimsuits, tights and hosiery, down jackets and overcoats. China has since stated that it will match such tariffs in kind promptly.

Earlier this week, the US President told his top trade official to study whether to raise tariffs on USD200 billion in Chinese goods from a planned 10 per cent to 25 per cent.

The US economy is more insulated from trade concerns, but Chinese leaders have retaliated strategically, targeting products made in Republican districts and final goods, like soybeans, that can be purchased elsewhere.

Representatives for the White House and the US Commerce Department did not immediately reply to requests for comment on China's retaliatory move.

The editorial said the United States had escalated trade friction with China and turned worldwide trade into a "zero-sum game". Another $16 billion in levies will likely follow in the coming days or weeks.

In addition, Beijing announced on Friday that it would add duties ranging from 5 to 25 per cent on an additional US$60 billion in United States goods if the Trump administration went ahead with similar action, warning that further countermeasures were ready at any time. China continues to move forward while for U.S. farmers, the trade war has represented a major step backwards.

There's "some hint" the Chinese may be warming to the idea, and recently there's been some communications at the highest levels of both governments, Kudlow said.

"China promises that it will continue to unswervingly push forward reform and opening-up based on established arrangements and pace, firmly support economic globalization, firmly safeguard free trade rules and multilateral trade mechanisms to realize joint development and share prosperity with all countries that pursue progress", the commission said.

"Market participants foresee a relatively stable Chinese currency in the near term, without fear of impacts from the US-China trade dispute".

"As the 'tit-for-tat" trade war continues, global markets appear to show resilience against any major moves by either the United States or China and the tariffs they are placing.

"Tariffs will make our country much richer than it is today".

Ed Mills, a policy analyst at Raymond James, said in a note to clients that while the possibility of a breakthrough deal remains, it is unlikely to come without increased trade restrictions.

This prompted an imposition of taxes on Chinese steel and aluminium imports.

Answering a reporter's question about what was specifically said on trade, Wang said: "We did not speak in such details". "Likewise other countries. We are Winning, but must be strong!"

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