Daily Trends Now
Daily Trends Now

U.S. targets $50B in Chinese imports

U.S. targets $50B in Chinese imports

The Washington Post reports that Beijing announced a plan Wednesday to implement 25 percent tariffs on imports of USA soybeans, airplanes and automobiles in a package that totals about $50 billion of us goods.

On Tuesday the USA announced it will soon start imposing a 25 percent tariff amounting to United States dollars 50 million on 1,333 products from China.

On March 22, Trump unveiled his plan to impose tariffs on around $50 billion of imports from China, while criticizing the USA trade deficit with it as "the largest deficit of any country in the history of the world".

Beijing's list of 25% additional tariffs on USA goods covers 106 items with a trade value matching the $50 billion targeted on Washington's list, China's commerce and finance ministries said.

The dispute has fueled fears it might set back the global recovery if other governments are prompted to raise their own import barriers.

Representatives of American business, which have complained for years that China has pilfered U.S. technology and discriminated against U.S. companies, were nevertheless critical of the administration's latest action.

USA authorities say Beijing denies foreign companies the right to block use of technology by a Chinese entity once a licensing period ends and imposes contract terms that are less favorable than for local technology.

"The Trump administration is right to push back against China's abuse of economic and trade policy, but imposing tariffs on producer goods will inadvertently hurt Americans through reduced capital investment and lower productivity growth".

That's on top of import charges announced Monday on 128 items including fruit, nuts, pork, ginseng, wine, steel pipe and aluminum scrap in retaliation for an estimated US$3 billion in USA tariffs on steel and aluminum. This could cut costs for USA meat companies.

Soybeans on the Chicago Board of Trade immediately dropped as much as 4.2 percent, while wheat and corn futures also slid, Bloomberg reported.

China's Made in China 2025 plan was announced in 2015, and highlighted 10 sectors for support on the way to China becoming an advanced manufacturing power, from information technology, to robotics and aerospace.

Mr Wang defended Made in China 2025, saying it was "transparent, open and non-discriminatory" and foreign companies could participate. That excludes much heavier Boeing jetliners, leaving Beijing additional high-profile targets for possible future rounds of the conflict.

The move comes after the Trump administration yesterday published a list of about 1,300 Chinese exports that could be targeted for tariffs.

Also on the list were American beef, whisky, passenger vehicles and industrial chemicals.

US President Donald Trump, who has long charged that his predecessors served the United States badly in trade matters, rejected the notion that the tit-for-tat moves amounted to a trade war between the world's two economic superpowers. A list circulated by the European Union targeted US products like Kentucky bourbon and North Carolina tobacco, leading to strong condemnations of Trump's efforts from members of his own party. But the China tariff gamble, which continues to shave value off global equities markets, is a whole different ball game from other recent trade actions. On Monday, China returned fire by imposing similar measures on $3 billion worth of US pork, fruit and other items.

Soy Canada executive director Ron Davidson says the 25 per cent levy on US goods could create some opportunities for Canadian exporters, but also force Canada to defend sales to 69 other countries. Eli Lustgarten, industrial outlook consultant at ESL Consultants, St Louis, said he was more concerned about the impact to food commodity exports, which would hurt Deere's US farm customers, than farm equipment exports.

If the US government had slapped duties in such imports, they would have dealt a blow to one of the United States' industrial pillars.

China's largest shipping company, though, said that it was ready to take "appropriate action" to protect its market should it start to see an impact.


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