China announced a 34% tariff on all products imported from the U.S. on Friday, escalating the trade war between the world’s two biggest economies.
The move came two days after President Donald Trump imposed the same tariff on all Chinese imports as part of what he called reciprocal tariffs on a long list of U.S. trade partners.
Combined with 20% in other levies that Trump has imposed on Chinese goods since returning to office in January, the total U.S. tariff on some Chinese goods is at least 54%.
Announcing the new tariffs at a White House event on Wednesday, Trump singled out China as one of the “nations that treat us badly.” The U.S. has a higher trade deficit with China than with any other country, reaching $295.4 billion last year.
China, one of the U.S.’s largest trading partners, urged the Trump administration to immediately cancel the tariffs and “resolve trade disputes through consultations in a manner of equality, respect and reciprocity.”
The latest U.S. tariff “does not comply with international trade rules, seriously harms China’s legitimate rights and interests, and is a typical act of unilateral bullying,” the Chinese Ministry of Finance said in a statement Friday. “It not only damages U.S. interests but also endangers global economic development and the stability of supply chains.”
China’s tariff on U.S. goods will take effect next Thursday, the ministry said. The new U.S. tariff on Chinese goods takes effect on Wednesday.
China also took aim at the U.S. agriculture sector, announcing an immediate suspension on the import of chicken products from three U.S. companies, and the import of sorghum from C&D (USA) Inc., citing health concerns.
The Chinese Commerce Ministry said it had filed a lawsuit at the World Trade Organization over the 34% tariff Trump announced Wednesday.
“China has always been a staunch defender of the international economic and trade order and a firm supporter of the multilateral trading system,” a ministry spokesperson said. “We urge the U.S. to immediately correct its erroneous practices and cancel the unilateral tariff measures.”
The ministry added 11 U.S. companies to its “unreliable entities” list, prohibiting them from importing from or exporting to China, and 16 companies to its export control list.
In addition, the Commerce Ministry announced an anti-dumping investigation into imported medical CT X-ray tubes from the U.S. and India and new export controls on rare earths including samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium starting Friday.
U.S. stock futures and European markets fell sharply on Beijing’s announcement. The news came on Friday evening in China as markets were closed for a public holiday.
China’s 34% tariff was much higher than expected, said Tianchen Xu, senior China economist at the Economist Intelligence Unit, a financial forecasting service.
China had been relatively restrained in its response to Trump’s earlier tariffs, keeping its retaliatory tariffs limited to 10% to 15% and targeted only at certain goods.
“We don’t see such restraint this time,” said Xu, who is based in Beijing.
“This reflects changes in China’s tactics — it probably wants to force Trump into negotiations,” he said.
Xu said China might be willing to make some concessions in exchange for tariff reductions, such as approving the sale of TikTok’s U.S. operations by its Chinese owner to avoid a U.S. ban, the deadline for which is Saturday.
China’s previous responses to U.S. tariffs had also included investigations, new export controls and the inclusion of more U.S. companies on the unreliable entities list.
Non-tariff measures such as restrictions on the export of rare minerals, which are key components in everything from electronics to defense systems, can have a significant impact, Xu said.
“In the extreme case, the U.S. will lose access to all China-produced critical minerals, and it will struggle to find replacements,” he added.
The U.S. imported $438.9 billion in goods from China last year, according to the U.S. Trade Representative, and exported $143.5 billion in goods.
https://www.nbcnews.com/news/world/china-hits-back-trump-34-tariff-us-imports-rcna199665
