US kicks off trade war with China
Rest Of World Too Will Be Hit By Trump Move
Washington:
The US and China slid into an unprecedented trade war on Friday. The world’s two largest economies slapped tariffs on $34 billion each on imports from the other country in an opening salvo that could soon take the entire world into an economic slowdown.
President Trump indicated to reporters on Thursday that he will bump it up to tariffs on $50 billion worth of Chinese goods in two weeks if Beijing continues with titfor-tat measures. And if China did not back down, he warned that he would up the stakes, first to tariffs on $200 billion worth of Chinese goods, and then to $ 500 billion, which is pretty much the entire complement of Chinese exports to the US.
In contrast, China imports only about $125 billion worth of goods from the US. The President and his aides clearly feel they have the upper hand in forcing Beijing to address the $ 375 billion trade deficit by buying more American goods to level the playing field.
China though has indicated that even if it has the lighter hand in imposing reciprocal punitive tariffs, it will not be bullied into buying American goods it does not need. Analysts say it can resort to some unconventional methods to inconvenience American businesses in China, with some fearing could mean tougher and subjective scrutiny on companies such as Starbucks and Apple, taking the trade war to uncharted territory.
“US measures are essentially attacking global supply and value chains. To put it simply, the US is opening fire on the entire world, including itself,” China’s commerce ministry spokesman Gao Feng said in Beijing.
The contagion is expected to spread. Trump has slapped tariffs on all major US trading partners: China, Canada, Mexico, the European Union and Japan (India is way down the line but is not excepted). All but Japan have imposed retaliatory tariffs.
The US imported nearly $ 2.4 trillion in goods in 2017, and as of now the tariffs are not particularly painful to American consumers (although prices of goods such as imported washing machines have risen) because they cover less than 5% of the imported goods. But if the issue is not resolved and Trump raises the stakes to tariffs on $ 800 billion imports from all major trading partners, everyone will feel the bite.
US tariffs on $34 billion in Chinese goods kicked into effort at midnight on Thursday, with 25% duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components. Merchant ships from both sides raced to ports to beat the midnight deadline, even as analysts warned there would be no winners in the trade war, just end-of-the-line losers among consumers and producers.
India is a relatively modest player in the global trade sweepstakes with a $ 23 billion trade gap with US. But Trump’s fundamentally nativist outlook and his take-no-prisoners, give-no-quarter negotiating style, Indian officials are acknowledging privately, comes as a sobering reminder that there is no such thing as a free lunch or friendship based on geo-politics with a businessman-President.
In fact, the scuttlebutt in Washington is that the Chinese were keen on making a deal to whittle down their surplus by pledging to buy $200 billion worth of American goods during talks in May, but the US President instructed his negotiators to seek ironclad guarantees, not just promises.
Trump’s minions were not impressed either with New Delhi’s projections that it would be buying billions worth of American airplanes, energy, and armaments in the coming decade, which would cumulatively wipe out the current $ 23 billion trade deficit. Many countries, including India, have complained that there are too many restrictions on American exports that they actually want, and Washington simply wants to unload its excesses, such a chicken legs, on countries that don’t particularly need them.
WHEN CHINA ROOTED FOR A CARGO SHIP: An illustration shows Peak Pegasus, a cargo vessel carrying soybeans from the US to the port in Dalian, China, on a ship-tracking screen. On Friday, China’s social media was rooting for the ship to beat the deadline before Chinese tariffs kicked in. Tracking the journey of the vessel was the 34th-highest trending topic on the country’s Twitter-like Weibo on Friday, beating the World Cup, showbiz gossip and Beijing’s escalating trade war with Washington. However, the Peak Pegasus fell short. At 5.30pm (local time), it was at anchor near Dalian, missing the noon deadline
Rest Of World Too Will Be Hit By Trump Move
Washington:
The US and China slid into an unprecedented trade war on Friday. The world’s two largest economies slapped tariffs on $34 billion each on imports from the other country in an opening salvo that could soon take the entire world into an economic slowdown.
President Trump indicated to reporters on Thursday that he will bump it up to tariffs on $50 billion worth of Chinese goods in two weeks if Beijing continues with titfor-tat measures. And if China did not back down, he warned that he would up the stakes, first to tariffs on $200 billion worth of Chinese goods, and then to $ 500 billion, which is pretty much the entire complement of Chinese exports to the US.
In contrast, China imports only about $125 billion worth of goods from the US. The President and his aides clearly feel they have the upper hand in forcing Beijing to address the $ 375 billion trade deficit by buying more American goods to level the playing field.
China though has indicated that even if it has the lighter hand in imposing reciprocal punitive tariffs, it will not be bullied into buying American goods it does not need. Analysts say it can resort to some unconventional methods to inconvenience American businesses in China, with some fearing could mean tougher and subjective scrutiny on companies such as Starbucks and Apple, taking the trade war to uncharted territory.
“US measures are essentially attacking global supply and value chains. To put it simply, the US is opening fire on the entire world, including itself,” China’s commerce ministry spokesman Gao Feng said in Beijing.
The contagion is expected to spread. Trump has slapped tariffs on all major US trading partners: China, Canada, Mexico, the European Union and Japan (India is way down the line but is not excepted). All but Japan have imposed retaliatory tariffs.
The US imported nearly $ 2.4 trillion in goods in 2017, and as of now the tariffs are not particularly painful to American consumers (although prices of goods such as imported washing machines have risen) because they cover less than 5% of the imported goods. But if the issue is not resolved and Trump raises the stakes to tariffs on $ 800 billion imports from all major trading partners, everyone will feel the bite.
US tariffs on $34 billion in Chinese goods kicked into effort at midnight on Thursday, with 25% duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components. Merchant ships from both sides raced to ports to beat the midnight deadline, even as analysts warned there would be no winners in the trade war, just end-of-the-line losers among consumers and producers.
India is a relatively modest player in the global trade sweepstakes with a $ 23 billion trade gap with US. But Trump’s fundamentally nativist outlook and his take-no-prisoners, give-no-quarter negotiating style, Indian officials are acknowledging privately, comes as a sobering reminder that there is no such thing as a free lunch or friendship based on geo-politics with a businessman-President.
In fact, the scuttlebutt in Washington is that the Chinese were keen on making a deal to whittle down their surplus by pledging to buy $200 billion worth of American goods during talks in May, but the US President instructed his negotiators to seek ironclad guarantees, not just promises.
Trump’s minions were not impressed either with New Delhi’s projections that it would be buying billions worth of American airplanes, energy, and armaments in the coming decade, which would cumulatively wipe out the current $ 23 billion trade deficit. Many countries, including India, have complained that there are too many restrictions on American exports that they actually want, and Washington simply wants to unload its excesses, such a chicken legs, on countries that don’t particularly need them.
WHEN CHINA ROOTED FOR A CARGO SHIP: An illustration shows Peak Pegasus, a cargo vessel carrying soybeans from the US to the port in Dalian, China, on a ship-tracking screen. On Friday, China’s social media was rooting for the ship to beat the deadline before Chinese tariffs kicked in. Tracking the journey of the vessel was the 34th-highest trending topic on the country’s Twitter-like Weibo on Friday, beating the World Cup, showbiz gossip and Beijing’s escalating trade war with Washington. However, the Peak Pegasus fell short. At 5.30pm (local time), it was at anchor near Dalian, missing the noon deadline
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