China Raises Tariffs On US Goods Amid Escalating Tensions

Beijing's decision reached $ 60 billion worth of US goods with new punitive tariffs ranging from 5 to 25 percent.

Beijing:

China on Saturday increased its tariffs on billions of US goods as it prepares to unveil a black list of "unreliable" foreign companies that analysts say is intended to punish US and foreign companies cutting supplies to telecom giant Huawei.

Beijing's decision hits $ 60 billion worth of US goods with new punitive tariffs ranging from 5 percent to 25 percent, and comes in retaliation for Washington raising punitive tariffs on $ 200 billion worth of Chinese goods to 25 percent.

Washington and Beijing resumed their trade battle last month when trade negotiations in the United States ended without agreement, with US negotiators accusing Chinese negotiators of reneging on their previous commitments.

Countries have exchanged tariffs on 360 billion dollars of bilateral trade so far.

The tariff war of the "tit-for-tat" has been relaunched in recent weeks by Washington's decision to put Huawei, the Chinese technology giant, on the blacklist for reasons of national security, threatening the global ambitions of the society.

The US Department of Commerce listed Huawei on a "list of entities" for national security reasons on May 16, a measure that limits its access to the US-made components it needs for its equipment. A stay of 90 days was subsequently granted.

The Chinese Ministry of Commerce said on Friday that it will publish its own list of "unreliable entities" that violate their commercial contracts and stop supplying Chinese companies.

"For China's countermeasures, what we say, we do it," said anchor Kang Hui as part of the Chinese state broadcaster CCTV's broadcast primetime news broadcast on several radio stations. Chinese Friday.

"Speaking and our door is open, fight, and we will fight to the end," said Kang.

The Chinese Ministry of Commerce said it would shortly roll out detailed measures against the companies on the list, noting that foreign companies that break contracts, cut supplies or take other discriminatory measures against Chinese companies would be included. .

"Of course, it's mainly for Huawei, Intel, Qualcomm, ARM ... it's probably for non-US companies, so European, South Korean, and Japanese companies might try to decide how to strictly enforce the decision. American, "said Andrew Polk, economist at Trivium China.

China wants to make a much harder choice to cut supplies to Huawei, he added.

"This risks putting companies in a situation where they are forced to choose between the US and China, which could backfire," Polk said.

The Chinese state tabloid the Global Times said the new list "would serve as a deterrent by forming a protective barrier around Chinese companies."

"China is ready to wage a prolonged economic and trade war with the United States," the nationalist newspaper said in an editorial.

Former Chinese officials warned Friday that the trade war could last for decades.

"It is very clear now that this is no longer a trade dispute and that it will extend much more widely to the punitive economic measures that each party can inflict on each other," said Christopher. Balding, an expert from China at Fulbright University Vietnam, adding that it was reasonable to expect further escalation on both sides.

"It's quite possible that there is significant collateral damage here," said Balding.

Speaking at a conference on defense and security in Singapore on Saturday, the US Defense Secretary said Huawei was "too close" to Beijing, creating "too much risk."

"The integration of civilian and military enterprises is too narrow, China has national policies and laws where data must be shared," said Patrick Shanahan at the forum.

Hiking rate
US President Donald Trump more than doubled punitive tariffs on $ 200 billion worth of Chinese goods to 25 percent last month, and kicked off the process to strike almost all of the remaining imports of the Asian giant.

China responded by raising tariffs from 5 percent to 25 percent on 5,410 US products Saturday, worth $ 60 billion in trade.

The list includes beauty products, sports equipment, musical instruments, wine, condoms, diamonds, wood, fabrics and toys.

Washington's tariffs seem to have already had an impact on Chinese manufacturing activity, which contracted more than expected last month.

While Trump insists that China will pay billions of dollars in tariffs, experts note that US consumers and importers are the hardest hit by tariffs on products entering the United States.

"The United States remains an important export market for China, but its importance is diminishing," said Wang Shouwen, who was part of China's negotiating team, according to the official Xinhua News Agency.