Stocks Plunge As China Hits US Goods With Tariffs

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In Washington, officials said the administration this week will unveil a list of advanced technology Chinese imports targeted for U.S. tariffs to punish Beijing over technology transfer policies.

China has slapped tariffs on 128 USA products, including imports of pork and certain fruits, in retaliation for President Donald Trump's levies on Chinese steel and aluminium.

In a statement from the Chinese Ministry of Finance, the government said the new tariffs "caused serious damage to our interests".

Brent Bible, a soybean and corn farmer in Lafayette, Ind., has appeared in TV ads by the advocacy group Farmers for Free Trade, calling on the Trump administration to avoid a trade war.

As a result, the tariff of 25 per cent on steel and 10 per cent on aluminium imports should restore the balance, the American president hopes.

The tariffs will be imposed under Section 301 of the 1974 U.S. Trade Act, following an intellectual property probe that began in August a year ago.

The volleys of threats are "a process of game-playing to test each other's bottom lines", said Tu Xinquan, a trade expert at the University of International Business and Economics in Beijing. The tariffs will affect roughly $3 billion in USA products.

Deputy White House Press Secretary Lindsay Walters on Monday responded to Beijing's announcement of the tariffs, saying that "instead of targeting fairly traded USA exports, China needs to stop its unfair trading practices which are harming United States national security and distorting global markets". About 25 percent of the pork products produced in North Carolina are exported and about15 percent of those go to China, which largely gets ears, feet and stomachs - or "variety meats", in pork industry parlance. In the oil markets, a barrel of USA crude gained 22 cents to $63.23 per barrel in electronic trading on the New York Mercantile Exchange while Bren crude, used to price worldwide oils, rose 29 cents to $67.93 in London. The United States is a reliable supplier of pork products to China, and this decision will have an immediate impact on US producers and exporters, as well as our customers in China.

But Trump came to power on a campaign platform that committed to putting "America first" on trade and jobs, rhetoric he is now turning into action through protectionist measures, of which he said there will be "many". The move is meant to punish Beijing over US accusations that China has systematically misappropriated American intellectual property.

U.S. President Donald Trump welcomes Chinese President Xi Jinping at Mar-a-Lago state in Palm Beach, Florida, U.S., April 6, 2017.

On March 24, when the Chinese Ministry of Commerce first announced the measures, a Government spokesman said: "According to the 2017 statistics, [the list] involves United States exports to China of some US$3 billion".

Trump administration officials have identified as potential targets 1,300 product lines worth about $48 billion.

"But historical experience tells us that at the moment of easing of the situation on the peninsula and as first light dawns on peace and dialogue, frequently all manner of disruptive factors emerge", Wang said.

"The trade war is going on and it is getting worse, so that might be the reason that people are selling the dollar and buying gold", said Yuichi Ikemizu at ICBC Standard Bank in Tokyo. Mr. Lighthizer must also persuade Congress to renew the administration's power to negotiate trade deals, the Trade Promotion Authority (TPA), which expires this summer. In the year that ended last August 31, America's soybean farmers, for instance, sent $12.4 billion worth of soybeans to China. But in commercial terms, they are "not very substantial" compared with China's $150 billion in annual imports of USA goods, he said.

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