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Trump administration announces $US200 billion in extra China tariffs

12 July 2018

The previous round of tariffs: The Trump administration last week imposed 25 percent tariffs on $34 million in Chinese goods, prompting Beijing to impose retaliatory tariffs of the same amount on U.S. imports.

China' s Ministry of Commerce said that the tariffs are "totally unacceptable" and it is hurting the entire world, as well as China.

The Trump administration said the new levies are a response to China's decision to retaliate against the first round of USA tariffs. It's unclear what that action could include.

"Given China's likelihood of retaliation, it's also billions worth of new tariffs on American exporters".

The proposal comes only a few days after the Trump administration fired the first real opening salvo in the trade war, implementing 25 percent tariffs on $34 billion in Chinese imports on Friday.

President Donald Trump has threatened to tax as much as $550 billion in Chinese products - an amount that exceeds America's total imports from China previous year.

Beijing has said it would hit back against Washington's escalating tariff measures, including through "qualitative measures", a threat that USA businesses in China fear could mean anything from stepped-up inspections to delays in investment approvals and even consumer boycotts.

China has, in recent years, become a key export market for growing USA energy exports.

The trade confrontation between Washington and Beijing has been escalating for months, despite Trump's repeated statements that he has a good relationship with China's President Xi Jinping.

South Korea's trade ministry said in a statement that the trade war could be "prolonged and spread", adding that it would prepare responses and scenarios to cope with the economic impact of the trade row.

"Rather than address our legitimate concerns, China has begun to retaliate against United States products".

While Chinese shares regained Wednesday's heavy losses, with the Shanghai Composite index rising 2.2 percent, the yuan fell against the dollar following the central bank's weakest daily fixing in almost a year and Washington's fresh tariff threats.

China 'cannot match fresh US tariffs, ' Vishnu Varathan of Mizuho Bank said.

Some US business groups and senior lawmakers sharply criticised the latest action on Tuesday, with Senate Finance Committee Chairman Orrin Hatch, a Republican, saying it "appears reckless and is not a targeted approach".

The US Chamber of Commerce has supported Trump's domestic tax cuts and efforts to reduce regulation of businesses, but it has been critical of Trump's aggressive tariff policies.

President Donald Trump has threatened higher tariffs on more than US$500 billion of goods, or almost all of China's annual exports to the United States.

'Tariffs on $200 billion in Chinese products amounts to another multibillion-dollar tax on American businesses and families, ' trade lawyer Scott Lincicome said.

Jack Gerard, Cal Dooley, and Edward R. Hamberger-the president and CEO of the American Petroleum Institute, president and CEO of the American Chemistry Council, and president and CEO of the Association of American Railroads, respectively-wrote in an opinion piece in the Washington Examiner published on Wednesday that the trade war is threatening the USA economy and could add "hundreds of billions of dollars in potential costs for American businesses - costs that could ultimately be borne by consumers".

The survey showed 53 percent of companies increased investment in 2017, down from 55 percent the year before, highlighting a trend of reduced investment growth since a 2012 peak, when 74 percent of respondents said they had boosted investment in China.

The Office of the US Trade Representative is seeking submissions on the latest proposed tariffs and will conduct hearings in late August, making September the earliest possible implementation date for the new import taxes.

Trump has said continuously that China has taken advantage of the U.S. economy, and he has vowed to hit almost all the country's products with tariffs, as much as $450bn.

Trump administration announces $US200 billion in extra China tariffs