China will levy tariffs on about $60 billion (€51.3bn) worth of US goods in retaliation for the latest round of US tariffs on Chinese products, as previously planned, but has reduced the level of tariffs that it will collect on the products.
The tit-for-tat measures are the latest escalation in an increasingly protracted trade dispute between the world’s two largest economies.
On Monday, the US administration said it would begin to levy new tariffs of 10 per cent on $200 billion worth of Chinese products on September 24th, with the tariffs to go up to 25 per cent by the end of 2018.
Previously, US president Donald Trump threatened to hit those goods with 25 per cent tariffs immediately.
“China is forced to respond to US unilateralism and trade protectionism, and has no choice but to respond with its own tariffs,” the finance ministry said in a statement on its website late on Tuesday.
China will levy tariffs on a total of 5,207 US products, at 5 and 10 per cent, instead of the previously proposed rates of 5, 10, 20 and 25 per cent, even as the products remain unchanged from the previous plan, the finance ministry said.
China will impose a 10 per cent tariff on US products it previously designated for a rate of 20 and 25 per cent, and 5 per cent tariffs on goods previously under the 5 and 10 per cent rates.
Items previously designated to be hit by 20 or 25 per cent tariffs included products ranging from liquefied natural gas and mineral ores to coffee and various types of edible oil. Those goods will now be taxed at 10 per cent.
Chemical products
Goods previously marked under the 10 per cent category included products such as frozen vegetables, cocoa powder and chemical products. Those products will now be taxed 5 per cent.
The new tariff measures will take effect at 12.01pm (5.01am Irish time) on September 24th.
China will further respond accordingly if the United States insists on increasing tariffs, according to the finance ministry.
The US action drew a sharp response from the European Union. "This escalation is very unfortunate," Cecilia Malmstrom, the EU's trade commissioner, told reporters. "Trade wars are not good and they are not easy to win."
In remarks earlier on Tuesday, a senior Chinese securities regulator criticised the US president for “poisoning” the atmosphere for negotiations.
“He tries to put pressure on China so he can get concessions,” said Fang Xinghai, who works closely with vice-premier Liu He. “That kind of tactic is not going to work.”
“Sino-US relations have reached their worst moment in 40 years,” said Lu Xiang, analyst at the Chinese Academy of Social Sciences. “We don’t know if Trump has a Plan B to get out of the quagmire.” – Reuters/Financial Times
