US and China raise tariffs in new round of trade dispute

The increases came as envoys met in Washington for their first high-level talks in two months.


A man sits in front of a billboard stating that American customers will be charged 25% extra due to ongoing China-US trade tensions (Chinatopix via AP)
A man sits in front of a billboard stating that American customers will be charged 25% extra due to ongoing China-US trade tensions (Chinatopix via AP)

The US and China have gone ahead with tariff hikes on billions of dollars of each other’s goods in an escalation of a battle over Beijing’s technology policy that companies worry will chill global economic growth.

The increases came as envoys met in Washington for their first high-level talks in two months.

They gave no sign of progress towards a settlement over US complaints that Beijing steals technology and its industry development plans violate Chinese free trade commitments.

The 25% duties, previously announced, apply to 16 billion dollars of goods from each side, including vehicles and scrap metal from the United States and Chinese-made factory machinery and electronic components.

In the first round of tariff hikes, US President Donald Trump imposed 25% duties on 34 billion dollars of Chinese imports on July 6.

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Visitors look at a manufacturing robot at the World Robot Conference in Beijing (Mark Schiefelbein/AP)

Beijing responded with similar penalties on the same amount of American goods.

The Chinese government criticised Thursday’s US increase as a violation of World Trade Organisation rules and said it would file a legal challenge.

Foreign ministry spokesman Lu Kang declined to give details of the Washington talks.

“We hope the US side will get along with us to strive for a good result from the talks with a reasonable and practical attitude,” said Mr Lu.

Beijing has rejected US demands to scale back plans for state-led technology development that its trading partners say violate its market-opening commitments.

American officials worry they might erode the US’s industrial leadership.

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With no settlement in sight, economists warn the conflict could spread and knock up to 0.5 percentage points off global economic growth through 2020.

Ahead of the Washington talks, Chinese state TV mocked Mr Trump with a sarcastic video posted on YouTube and other social media pages of its international arm, China Global Television Network.

“You are great,” said a presenter on the nearly three-minute-long English-language clip, reading a letter that pays a satirical tribute to Mr Trump.

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An online video about US-China trade tensions produced by China’s state television broadcaster plays on a computer screen in Beijing (Mark Schiefelbein/AP)

“On behalf of doctors, thank you for pointing out the need to wean off American goods like bourbon and bacon,” the presenter says, referring to products on which China imposed retaliatory tariffs.

The video appeared to have been removed on Thursday from CGTN’s social media accounts.

Mr Trump has proposed another possible round of tariff hikes imposing 25% increases on an additional 200 billion dollars of Chinese goods.

Beijing issued a 60 billion dollar list of American imports for retaliation if Washington goes ahead with that.

That smaller target list reflects the fact that Beijing is running out of American goods for retaliation due to its lopsided trade balance.

China’s imports from the United States last year totalled about 130 billion dollars. That leaves about 20 billion dollars for penalties after tariffs already imposed or planned on a total of 110 billion dollars.

Chinese authorities have said they will take “comprehensive measures”, which companies worry could mean targeting operations of American businesses in China for disruption.

Press Association

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