Trump ups pressure on China; demands 25% tariffs instead of 10%

Trump ups pressure on China; demands 25% tariffs instead of 10%

Trump ups pressure on China; demands 25% tariffs instead of 10%

China on Thursday urged the United States to "calm down" and return to reason after the Trump administration sought to ratchet up pressure for trade concessions by proposing a higher 25-percent tariff on $200 billion worth of Chinese imports.

"The current unilateral threats and pressure from the United States will only backfire", he said.

Trump on Wednesday instructed the US Trade Representative to look into increasing tariffs on Chinese imports including fish, petroleum, chemicals, refrigerators, handbags and other goods to 25 per cent, reports The New York Times.

Still, it is hard for the U.S. and the European Union to reach a tangible agreement to "work together toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods", as Trump said, because of the contradictory ideas and opinions on the two sides.

If Trump imposes the new duties on China as well as a threatened third set of tariffs on another $US200 billion of imports, effectively all of the Asian nation's USA exports would be impacted. The International Monetary Fund has cited escalating trade disputes as a growing downside risk that's threatening the strongest global economic upswing in seven years. According to Derek Scissors of the Washington-based American Enterprise Institute, a 25 percent tariff rate could shut out Chinese products and shift American supply chains to other countries, as a 10 percent duty could be offset by government subsidies and weakness in the yuan.

China's imports from the United States past year totaled $153.9 billion.

Trump has also "privately told advisers this week that he was intent on staying the course to punish China with additional tariffs", and the argument of Treasury Secretary Mnuchin, that negotiations should come before more tariffs, was "weakened by a recent and rapid depreciation in China's currency".

China has already felt the wrath of tariffs on its goods.

Chinese authorities warned earlier that if the dispute escalated, they would adopt unspecified "comprehensive measures".

MSCI's gauge of stocks across the globe shed 0.75 per cent and Germany's DAX blue-chip index, seen as a trade war proxy, fell 1.5 per cent. USA stocks were mixed.

China promptly promised it would take countermeasures of its own.

The United States and China have the world's biggest trading relationship but official ties are increasingly strained over complaints that Beijing's technology development tactics hurt American companies.

"As to communications and talks between the two sides the Chinese side always believe that the trade disputes shall be resolved through talks and negotiations and our sincerity and efforts are there for all the global community to see".

"We would advise the United States to correct its attitude and not try to engage in blackmail". He obviously has a poor grasp of macroeconomics, but it's also possible that his invocation of trade deficits is just a cynical ploy, and that he expects to stop referring to the statistic when it is no longer useful to him.

"European Commission figures released this week showed that 37 percent of the EU's soybean imports in June came from the U.S., compared with 9 percent in July 2017".

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