China hits back in trade war with US

BEIJING: China has announced it is raising tariffs on 60 billion dollars (£46 billion) of US goods in retaliation for the latest hike in American tariffs on its exports.The move deepened a trade battle between the countries and sent financial markets into a tailspin. The finance ministry said the new penalty duties of 5 per cent to 25 per cent on hundreds of US products, including batteries, spinach and coffee, will take effect on June 1.That followed Donald Trump’s increase on Friday of duties on 200 billion dollars (£153 billion) of Chinese imports from 10 per cent to 25 per cent after claiming that China had backtracked on commitments it made in earlier negotiations in a dispute over Beijing’s technology ambitions and perennial trade surplus.Resuming his messages over Twitter early Monday, President Trump warned Chinese President Xi Jinping that China “will be hurt very badly” if it doesn’t agree to a trade deal. Trump tweeted China “had a great deal, almost completed, & you backed out!” He insisted the tariffs the US has placed on Chinese goods do not hurt American consumers, saying there is “no reason for the US consumer to pay the tariffs”.White House economic adviser Larry Kudlow acknowledged on Sunday that US consumers and businesses pay the tariffs. “Both sides will pay,” he said. China had vowed “necessary countermeasures” on Friday against Trump’s escalation of the tariff conflict.Beijing is running out of US imports for penalties due to the lopsided trade balance between the world’s two largest economies. Regulators havetargeted American companies in China by slowing down customs clearance for shipments and processing of business licences. The new tariffs are likely to hurt exporters on both sides, as well as European and Asian companies that trade between the United States and China or supply components and raw materials to their manufacturers.

from The News International - World http://bit.ly/2JAqab2