Washington has recently announced plans to impose 25 percent tariffs on 1,300 Chinese products following an investigation into China’s trade practices and policies, including “Made in China 2025”, Beijing’s strategy to guide the country’s industrial modernization.
The United States Trade Representative Office released details of goods imported from China worth about US$50 billion that it planned to hit with 25 percent tariffs, with the emphasis on industrial and hi-tech goods.
Responding to the US move, Wang Shouwen, China’s vice-minister for commerce said it was “unacceptable”. He, added, “The trade balance is decided by market forces, and US economic policy and structure. China alone cannot reduce the surplus.”
Retaliating to the US action, Beijing filed a request for consultation on the United States’ tariff plans with the World Trade Organization.
The impact of these actions resulted in fall of the financial and commodities markets around the world. US carmakers and aircraft companies are the most affected sectors as both of which are at the center of China’s tariff plans. European markets were also hit
US President Donald Trump responded on Twitter to Beijing’s tariff plans, saying America was not in a trade war with China, but that it had a trade deficit of US$500 billion a year and “intellectual property theft of another US$300 billion”. “We cannot let this continue!” he said.
China responded to President Donald Trump’s tariff threats releasing a list of 106 American exports that could face reciprocal taxes. According to China, about 40 percent of the products would be taxed that include plastics, petrochemicals, petroleum products and specialty chemicals. The threatened tariffs come at a time when American companies are planning to invest billions in new petrochemicals and plastics facilities.