Two days after the United States said it would consider bumping the proposed 10 percent tariff on $200 billion worth of Chinese imports to 25 percent, China has responded with plans to impose tariffs on another $60 billion worth of U.S. products.
With neither side backing down, and President Trump prepared to continue the escalations until he’s met with a solution that’s amenable to him, tariffs could reach higher and wider before the bleeding stops.
On the basis of the U.S. announcement, a spokesperson from China’s Ministry of Commerce said, “China has decided to impose tariffs on the approximately $60 billion of products imported from the United States.” The measures, the Ministry said, are both “rational and restrained.”
“The Chinese side once again stressed that because the U.S. side has repeatedly escalated the situation despite the interests of both enterprises and consumers, China has to take the necessary countermeasures to defend the country’s dignity and the interests of the people, defend free trade and the multilateral system, and defend the common interests of all countries in the world,” the Ministry continued.
China’s move is exactly the one the U.S. doesn’t want it to make. Trump has long expressed that since his aim is to bring trade with China back into balance, China’s retaliations will only serve to maintain the imbalance he’s trying to correct.
Considering both countries’ postures, many can’t see an end in sight for this trade war.
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The United States Trade Representative Robert Lighthizer said in a statement Wednesday that instead of changing its policies in line with its missteps surrounding intellectual property and forced technology transfer, “China has illegally retaliated against U.S. workers, farmers, ranchers and businesses.”
If the U.S. continues to move forward with the proposal to hike the tariffs to 25 percent, it would apply to the same products outlined when the tariffs were slated for a 10 percent rate—cotton, yarns, fabrics, handbags and hats, just some among the long list of targets.
The USTR said it will accept comments on the proposed action through Sept. 5, and decisions would follow in line with what emerges from the comments and the public hearing, and likely, what China decides to do between now and then.
For China’s part, there’s still hope both parties can come back to the table to find an “effective way to resolve trade differences,” the Ministry of Commerce said. Barring that scenario, the Ministry said, “Any unilateral threat or blackmail will only lead to intensification of conflicts and damage to the interests of all parties.”