Published: Sat, August 11, 2018
Money | By Armando Alvarado

China out with retaliatory tariffs on U.S.

China out with retaliatory tariffs on U.S.

China's quota system allows 34 imported movies a year to be shown in theatres, while overseas producers get a 25 percent share of box office takings, less than in other worldwide markets.

Having claimed that "trade wars are good and easy to win", President Trump has said that he is prepared to hit up to $500 billion of Chinese goods with taxes in an attempt to reduce America's...

The United States shipped 3.2 million tonnes of coal to China previous year, up from less than 700 tonnes in 2016, making it China's seventh largest supplier, although well behind top supplier Australia with almost 80 million tonnes.

"My expectation is that U.S. tariffs on $250 billion of imports from China will be in effect about a month prior to the November U.S. elections".

Thirty-four days ago, the US officially began taxing $34 billion in Chinese imports - and China immediately responded with reciprocal tariffs, thus kicking off day 1 of the U.S. The US published its final list of goods subject to the tariffs on Tuesday.

On Tuesday, the Trump administration announced that it would proceed with previously announced 25 per cent tariffs on an additional $16 billion of Chinese imports starting August 23.

China's Ministry of Commerce retaliates against U.S. tariffs on Chinese imports. "Of course, China will retaliate, probably dollar for dollar", Hufbauer said.

Last week, China proposed additional tariffs on another $60 billion of USA goods after Trump raised planned tariffs on $200 billion worth of Chinese imports to 25 percent from 10 percent. Beijing says it is ready to retaliate against $60 billion of American imports.

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Trump has claimed in recent tweets that "tariffs are working far better than anyone ever anticipated", linking them to a downturn that has shaved almost a quarter from the value of Chinese stocks since late January. They are meant to protect homegrown businesses and put foreign competitors at a disadvantage. To some extent, those elections will be a referendum on Trump's trade policies, and if Republicans lose control of one or both houses of Congress, Trump's hand will weaken, while China's will get stronger. The U.S.is the world's top producer of natural gas and is a growing LNG exporter.

Such tariffs will not be levied on other countries that export scrap recyclables to China, ISRI noted, but it's unclear if those nations can fulfill all of the demand in China. Economic growth has slowed since regulators tightened controls on bank lending to rein in surging debt. The decline reflects import bans and higher quality requirements introduced by China.

It is the second round of tariffs the USA has placed on China this month. And since 2007, domestic wholesale and retail proceeds have been higher than export earnings, with the gap widening at a slow but steady pace over the past decade.

China's global trade surplus narrowed by 40 percent from a year earlier to $28 billion. "The largest effects will be felt on the eastbound Transpacific, but the key area to watch is how far tariffs on US imports risk disrupting complex cross-border supply-chains which feed into finished products and which are especially key to the high density of regional and feeder services in the intra-Asia market". Soon after, a list of United States products was issued that will suffer a 25% increase in taxation.

Beijing has stepped up efforts, so far without success, to recruit governments including Germany and France as allies. They criticize Trump's tactics but share USA complaints about Chinese industrial policy and market barriers. So it makes sense to step back, assess where the Trump trade wars stand, and estimate how much further they could go.

China's refined products exports last month were 4.57 million tonnes, almost flat from a year earlier. It was necessary to take this action "because the USA side has repeatedly escalated the situation despite the interest of both enterprises and consumers". Longer term contract negotiations could also be affected.

China's largest refiner Sinopec Corp (0386.HK) is due to deliver its best quarterly result since 2013 later this month, thanks to robust refining business and rebound in oil prices.

China's stance now is that a resolution of trade tensions must not block its further economic progress, but adjustments to Made in China 2025 could happen.

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