There appears to be no end in sight for the U.S.-China trade war.
Hours after President Trump announced the latest tranche of $200 billion in tariffs on Chinese imports set to take effect Monday, Alibaba founder and executive chairman said this battle could drag on for as long as 20 years.
And if the quid pro quo tariff attacks continue as they have—with China responding to Trump Tuesday with $60 billion in tariffs on U.S. goods—tensions aren’t yet subsiding.
In a statement following the one from the White House, China’s Ministry of Commerce said, “In spite of China’s resolute opposition and solemn representation, the U.S. has insisted on adopting the wrong approach of violating the rules of the World Trade Organization, seriously infringing on the legitimate rights and interests of China.”
China will place 10 percent tariffs on upward of 3,000 U.S. products, with a smaller group of American goods facing a 5 percent tariff. These new tariffs will also take effect on Monday, in line with the U.S. imposed tariffs.
The latest round of targeted items—including things like leather apparel, some textiles and the machinery that goes with it—on Trump’s list will face 10 percent tariffs from Monday, and if there’s no deal between the two powerhouse nations, the rate will hike to 25 percent starting Jan. 1, 2019.
Following China’s clapback, as has been standard practice in this ongoing trade war, Trump reasserted his threat for a whole new counter-retaliation if China doesn’t back down.
In remarks ahead of a meeting with Polish president Andrzej Duda Tuesday, Trump said, “If there’s a retaliation against our farmers and our industrial workers, our ranchers, if any of that goes on, we’re going to kick in another $257 billion. And that will be also at 25 percent. We don’t want to do it, but we probably—we’ll have no choice.”
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In Monday’s tariff announcement, the president pegged the promised additional tariffs at $267 billion instead of the $257 billion he noted Tuesday, but the White House has said $267 billion is the correct number. What’s of note, though, is that “phase three” of the tariff war, as Trump refers to it, would amount to the U.S. placing tariffs on all China-originating goods coming into the U.S. Already, the U.S. has imposed tariffs on $250 billion worth of Chinese goods.
Ahead of the latest $200 billion, China had threatened to pull out of planned trade talks with the U.S., but Trump seems to think conversations are still forthcoming.
The president said Tuesday, “We’ll see what happens. But we’re making a lot of headway with China. China wants to come over and talk, and we are always open to talking. But we have to do something. We have a tremendous trade imbalance with China, tremendous trade deficit. And the way I look at it: Last year, we lost over $500 billion to China. We can’t do that. I don’t want to do that. And that’s been going on for many years. Other Presidents should have taken care of this situation, and they didn’t. But I’m going to.”