Published: Sat, June 16, 2018
Money | By Armando Alvarado

Trump slaps tariffs on $50 billion worth of Chinese technology goods

Trump slaps tariffs on $50 billion worth of Chinese technology goods

President Trump speaks to reporters on the North Lawn of the White House on June 15, shortly after he announced new tariffs on China.

"Technology and innovation are America's greatest economic assets and President Trump rightfully recognises that if we want our country to have a prosperous future, we must take a stand now to uphold fair trade and protect American competitiveness".

Then Trump said: "When we lose $500 billion a year ... in a trade deficit".

American businesses, however, are anxious that rising trade tensions will hurt USA economic growth. We strongly oppose a trade war with China because no one ever wins in these tit-for-tat disputes.

United States stock futures declined, and haven assets such as the yen and Treasuries rallied after the announcement.

President Trump set to approve a new list of $50 billion worth of tariffs on Chinese goods, according to press reports.

The list of 659 United States goods was longer than a preliminary list of 106 goods published by the commerce ministry in April, although the value of products affected remained unchanged at US$50 billion. After receiving public comment, the USA removed from the list hundreds of products, including televisions and some pharmaceuticals, according to a senior administration official who briefed reporters on condition of anonymity. The list will contain 800 product categories, down from 1,300 previously, Reuters reported, citing another administration official and an industry source familiar with the list. Imposing tariffs on old-tech industries, though, is like busting your neighbor's mailbox because you think he's poaching your wi-fi signal.

If China retaliates, as it has already pledged to do, the U.S. will impose even more tariffs, Mr Trump warned.

The possibility of retaliatory tariffs have been particularly worrisome to farmers and parts of President Donald Trump's rural base.

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After a round of talks in May in Washington, Chinese officials promised to buy more American farm goods, natural gas and other products to narrow China's multibillion-dollar trade surplus with the United States. China tried to resolve the trade war earlier this month by promising to purchase $70 billion worth of commodities and manufactured goods from China, but that gambit obviously failed.

Here's another possibility: Trump may have been bullied into the trade war.

The US says its tariffs on Chinese goods are in response to what it categorises as theft of intellectual property.

China will impose tariffs with "equal scale, equal intensity" on imports from the U.S. and all the consensus the two sides reached earlier will lose effect, the Commerce Ministry said in a statement.

" It's an unfair measure because it has no economic or technical basis and it's worrying as it could call into question the rules governing global trade", Planas said, adding that he will raise the issue at an upcoming meeting of European Union agricultural ministers. "They've taken so much", Trump said in an interview with "Fox & Friends".

Less than a month after the Trump administration declared that the China trade war was "on hold", it appears to be back on.

The U.S. trade actions against China could lead to retaliation from Beijing. The president has coordinated closely with China on efforts to get Pyongyang to eliminate its nuclear arsenal.

Wall Street has viewed the escalating trade tensions with wariness, fearful that they could strangle economic growth and undermine the benefits of the tax cuts Trump signed into law past year.

"We're asking them to completely change who they are and we're shaking this little stick in front of them", said Derek Scissors, an expert on the Chinese economy at the American Enterprise Institute.

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