Skip to main content

China Retaliates With Tariffs, US Promises a Retaliation to the Retaliation

China had been promising to retaliate against the U.S. for imposed tariffs, and wasting no time at all, the country’s commerce ministry responded Friday outlining reciprocal tariff measures and alluding to what may finally be an official trade war.

The United States Trade Representative announced on Friday morning that the U.S. would proceed with 25 percent tariffs on $50 billion worth of Chinese goods over the country’s intellectual property infringements, effective beginning July 6. In response, the Chinese government said it will immediately impose “equal strength measures.”

“The Chinese side doesn’t want to fight a trade war, but facing the shortsightedness of the U.S. side, China has to fight back strongly,” a statement from the country’s commerce ministry said, according to AP. “We will immediately introduce tax measures of equal scale and equal strength, and all economic and trade achievements reached by the two sides will be invalidated.”

China could be referring to its recent promise to buy more from American farmers and additional natural gas to help narrow the trade imbalance with the U.S. following a round of talks in Washington last month. What may have served to undermine that promise, however, was a meeting in Beijing earlier this month where the Chinese government said it would scrap the deals if the U.S. moved forward with its tariff measures.

The commerce statement on the impending retaliation didn’t detail the American products it would target with the retaliatory tariffs, but the list it released in April upon preparing itself for this very response included new duties on soybeans, whiskey and automobiles, and for the apparel industry in particular—U.S. cotton.

Related Stories

Naturally, President Trump has promised a U.S. retaliation in response to China’s retaliation.

In a White House statement Friday, Trump said the U.S. can no longer “tolerate” China’s actions on trade.

“My great friendship with President Xi of China and our country’s relationship with China are both very important to me,” Trump said, adding, however, “This situation is no longer sustainable.”

Because he believes the tariffs are a rightfully fair response to what he considers long-standing unfair actions on China’s part, a retaliation won’t be palatable to the president.

“The United States will pursue additional tariffs if China engages in retaliatory measures, such as imposing new tariffs on the United States goods, services, or agricultural products; raising non-tariff barriers; or taking punitive actions against American exporters or American companies operating in China.”

Since China has already taken those actions, the coming days could bring with them more tariffs on imports from China, and there’s no telling yet which sectors will be hardest hit.