China vows to retaliate to Donald Trump's tariffs on $50bn of goods

Beijing has threatened to counterpunch if Trump goes ahead with the plan to impose tariffs on Chinese goods

Beijing has threatened to counterpunch if Trump goes ahead with the plan to impose tariffs on Chinese goods

As he made the US tariffs official, Trump said that "if China engages in retaliatory measures, such as imposing new tariffs on United States goods, services, or agricultural products", his administration would impose new tariffs in response.

The moves increase the trade dispute between the world's two largest economies.

Chinese media have mocked US President Donald Trump over plans to impose 25% tariffs on $50bn worth of Chinese goods, saying "wise men build bridges but fools build walls".

In an editorial, the official English-language China Daily said the measure was "a stark violation of the core spirit of recent trade talks between China and the United States and is set to backfire if Washington doesn't back off from its risky adventurism". Within hours of the White House's announcement, the Chinese government issued a statement threatening to "immediately introduce taxation measures of the same scale and the same strength", CNBC reports.

"Both U.S. and Chinese exporters will suffer considerable economic losses while these punitive tariffs are in place, and many Asian countries that are part of the Chinese manufacturing supply chain will also suffer collateral damage in this escalating trade war".

The China trade offensive is only one side of Trump's multi-front battle with all major United States economic partners.

China has published its own list of threatened tariffs on $50 billion in USA goods, including soybeans, aircraft, and autos, and has said it would hit back if Washington followed up with further measures.

The tariffs will cover 1,102 Chinese product lines worth about $50 billion a year.

"While the end game is a compromise trade deal that meets US demands for stronger Chinese protection of intellectual property rights, the road to a trade deal has become very ugly", said Rajiv Biswas, APAC chief economist at IHS Markit in Singapore.

The tariffs will also be applied to autos and aquatic products, the ministry said.

U.S. Customs and Border Protection will begin to collect tariffs on the first $34 billion worth of Chinese imports on July 6.

Mr Trump has already slapped tariffs on steel and aluminium imports from Canada, Mexico, Europe and Japan, drawing a rebuke from U.S. allies.

But if the president follows through on all the duties he's threatened, including the tariffs against China, U.S. inflation could accelerate by 15 basis points, according to Goldman Sachs.

Another Democrat, Sen. Sherrod Brown of OH, tweeted that the tariffs are an important step to reset the trade imbalance with China.

"Trade between our nations, however, has been very unfair, for a very long time", Trump said Friday.

Wall Street has viewed the escalating trade tensions with wariness, fearful that they could strangle the economic growth achieved during Trump's watch and undermine the benefits of the tax cuts he signed into law previous year.

"In today's era, launching a trade war is not in the global interest", the ministry's statement reads. "We call on all countries to take joint action, resolutely put an end to this outdated and regressive behavior, and firmly defend the common interests of mankind".

Women interact near a robot designed by Chinese robotics company Pangolin at the Consumer Electronics Show Asia 2018 in Shanghai, China on June 15, 2018.

The US, Europe, Japan and other trading partners complain Beijing's tactics including outright theft of foreign technology and subsidies and protection from competition for fledgling Chinese industries.

Beijing has reiterated that it will respond "appropriately" to any measures imposed by the US. "Those are crown jewels for this country", the president said.

American businesses, however, are anxious that rising trade tensions will hurt USA economic growth.

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