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China set to retaliate as US tariffs take effect


Beijing said it would be “forced to make a necessary counterattack” after US tariffs on $34bn (£25.6bn) of Chinese goods came into effect.

The 25% duties apply to Chinese machinery, electronics and other hi-tech equipment including cars, computer hard drives and LEDs.

Tariffs on an additional $16bn (£12.1bn) of Chinese goods are set to take effect in two weeks, Mr Trump has said.
The US is prepared to target up to $500bn (£377.8bn) more, he has warned, unless Beijing yields to Washington’s demands.
Mr Trump’s administration contends that China has deployed predatory tactics to try to overtake US technological dominance.
These allegedly include requiring US companies to hand over technology in exchange for access to China’s market.
China’s Commerce Ministry said it would be “forced to make a necessary counter-attack”.

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While it gave no immediate details, China previously released a list of US goods it might potentially target including soybeans, light aircraft, orange juice and whiskey.
The China Daily newspaper accused the Trump administration of “behaving like a gang of hoodlums”.
“There should be no doubting Beijing’s resolve,” it added.
The American Chamber of Commerce in China said US companies wanted fairer treatment but would be hurt by US-Chinese tensions.
Its chairman, William Zarit, said: “There are no winners in a trade war.
“We urge the two governments to come back to the negotiation table.”
It may be some time before the effect of the tariffs is clear.

“It will take three, six or 12 months before their impact becomes visible,” Tokyo branch manager for State Street Bank and Trust, Bart Wakabayashi, said.

Image: The tariffs escalate a trade war between the US and its biggest trading partner
Co-head of Asia economic research at HSBC in Hong Kong, Frederic Neumann, said he was “fairly relaxed” about the tariffs and trade dispute.
“I don’t think it’s as disruptive as often described,” he added.
“China’s position is strong enough to avoid a hard landing in the current scenario.”
The most important aspect may be how long the situation continues.
“When economists run various economic models, they get estimates that it will slash US GDP only by 0.1%,” said Kozo Koide, chief economist in Tokyo for Asset Management One.
“That would be true if tariffs would be imposed only for a year,” he added.
“But you don’t know how long this will continue.
“Such uncertainties will surely affect companies’ spending and hiring plans.
“Markets are worried the economy may lose momentum earlier than previously thought,” he said.
Stock markets, which have wobbled in recent weeks as the fears of a US-inspired global trade war have intensified, were fairly calm on Friday as the tariff developments had been anticipated earlier in the week.

More from China

China’s Shanghai Composite recovered its poise after initial falls to new lows not seen since 2016 on Friday while the Nikkei in Japan ended a four-day losing streak.
In Europe, stocks were generally positive with the FTSE 100 trading 0.2% higher – above the 7,600 points barrier.

Source: Sky

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