Beijing, China on Monday said it would raise tariffs on $60 billion of US goods from June 1, a tit-for-tat response to Washington increasing levies on Chinese products last week.
China’s Ministry of Finance said the additional tariffs will range from 5 per cent to 25 per cent on 5,140 products.
“On May 9, 2019, the US government announced that since May 10, 2019, tariffs on the $200 billion lists of goods imported from China have increased from 10 per cent to 25 per cent,” a statement by the Ministry said in Chinese.
“The above measures by the US have led to an escalation of the Sino-US economic and trade frictions, contrary to the consensus between China and the US on resolving trade differences through consultations, jeopardising the interests of both sides and not meeting the general expectations of the international community.
“The State Council Tariff Commission decided that on June 1, 2019, the part originating in the US imported goods will increase the tariff rate,” it said.
This was much expected after the US on Friday activated a raise of 25 per cent in tariffs on the Chinese goods worth $200 billion, a move that escalated over a 10-month trade war.
Beijing’s retaliatory move came shortly after US President Donald Trump warned it against jacking up taxes on US goods. “China should not retaliate — will only get worse!” Trump posted on Twitter.
He said Beijing would be “hurt very badly” if the country did not make a deal with Washington and accused it of “taking advantage of the US for so many years”.
The US President suggested that manufacturers who make goods in China could shift production to other countries to avoid the tariffs.
“I say openly to President Xi (Jinping) and all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries. Too expensive to buy in China. You had a great deal, almost completed and you backed out!” he tweeted.
“Many tariffed companies will be leaving China for Vietnam and other such countries in Asia.”
He also claimed the trade war would not have a significant impact on the US trade. “We are right where we want to be with China. Remember, they broke the deal with us and tried to renegotiate. We will be taking in tens of billions of dollars in tariffs from China. Buyers of product can make it themselves in the USA (ideal), or buy it from non-tariffed countries.”
Trump’s top economic adviser Larry Kudlow, however, said “both sides will suffer” from the trade dispute.
In an interview with Fox News on Sunday, Kudlow said it was American businesses that paid the tariffs on any goods brought in from China and that US consumers would also foot the bill if firms passed on the cost increase.
The two largest economies have slapped tariffs on goods worth $350 billion since July last year. The two sides met for the 11th time last week in Washington, only to leave with no deal.
Trump’s surprise decision to crank up levies on Chinese goods has dealt a blow the progress in trade talks made in the past.
