China Warns Of Retaliation If US Takes More Trade Steps

  • China Warns Of Retaliation If US Takes More Trade Steps

China Warns Of Retaliation If US Takes More Trade Steps

China said Friday it is poised to impose retaliatory tariffs on $60 billion worth of US imports, including coffee, honey and industrial chemicals, if Washington goes ahead with its latest trade threat.

Earlier this week, the White House said it was considering boosting tariffs on $200 billion worth of Chinese goods, raising those tariffs to 25 percent from 10 percent.

Until now, senior administration officials have made great efforts to reassure investors and businesses that (a) tariffs are unlikely to be imposed; (b) even if imposed, the economic impact will be small; (c) the economy is strong enough to weather any hit; and (d) the short-term pain is worth the long-term gains from resetting relations with China.

China promptly promised it would take countermeasures of its own.

"Escalating tariffs against China is the wrong approach to address legitimate concerns U.S. businesses have with China's harmful practices", said Myron Brilliant, head of worldwide affairs for the U.S. Chamber of Commerce.

There was no immediate reaction from the Chinese government.

"I need to stress that dialogues must be conducted on the basis of mutual respect and equality", he said. "Any unilateral threat or blackmail is only going to escalate the conflict and hurt everybody's interests".

Trump initially threatened to levy 10 percent on an additional $200 billion but that figure may now rise to 25 percent, sources told the Washington Post and Bloomberg.

From left, China's President Xi Jinping and U.S. President Donald Trump shake hands on November 9, 2017, during a meeting outside the Great Hall of the People in Beijing.

If Trump imposes the new duties on China as well as a threatened third set of tariffs on another $200 billion of imports, effectively all of the Asian nation's US exports would be impacted.

The tariffs discussed in this week's pronouncements are still in the threat stage; they have not yet taken effect.

The proposal would require a more robust justification from the Department of Defense for "Section 232" tariffs such as those imposed on steel and aluminum imports and those now under consideration for autos.

President Trump and the European Commission President Jean-Claude Juncker agreed last week to put their tariffs on hold while the two sides negotiate, including on the dispute over steel tariffs, which gives the USA more leverage to pressure China.

But the move drew swift condemnation from USA business lobby groups anxious that tit-for-tat tariffs would start to hamper economic growth.

Last month, China blocked American chipmaker Qualcomm from buying Dutch firm NXP in a regulatory step that some White House officials had hoped would be lifted.

Meanwhile, the Chinese economy is likely to feel a pinch, but that doesn't mean the country will back down, William Zarit, the chair of the U.S. Chamber of Commerce in China, tells NPR.

The Chinese have already proposed buying more US goods in order to settle the dispute, only to have the White House-which wants to win a broader argument about intellectual property and subsidies-reject the proposal. Investment is down. Consumption is down. South Korea's exports showed slower-than-expected growth.

In addition to Beijing's top-down control, the recent diversification of China's economy and its exports makes the country better positioned to endure a trade war now than it could have in the past, NPR's Jim Zarroli reports.