The Tariff War
- China Has decided to implement new tariffs on meat, fruit and other products from the U.S. as retaliation for American duties, heightening fears of a potential trade war between the world’s two largest economies. The impending trade war between the Trump administration and China has been building up for almost a year.
- Beijing’s latest move is direct retaliation against taxes approved by President Donald Trump on imported steel and aluminium.
- China’s Customs Tariff Commission is increasing the tariff rate on pork products and aluminium scrap by 25 percent. It’s also imposing a new 15 percent tariff on 120 other imported U.S. commodities, from almonds to apples and berries.
- The extra tariffs will hit 128 kinds of U.S. products and as per china the affected U.S. goods had an import value of $3 billion in 2017 and included wine, fresh fruit, dried fruit and nuts, steel pipes, modified ethanol and ginseng.
- Beijing could also ramp up its response by adding more goods to the 128-strong list.But “more relevant products in terms of value of U.S. exports can hardly be included if China wants to achieve its Manufacturing 2025 targets,” it continued, referring to a 30-year plan to boost China’s industrial base.
Repercussions
- China’s move could hit U.S. President Donald Trump’s base, particularly the farmers in Iowa, Ohio and Michigan — the top soya-bean producing States. The U.S. is the second biggest supplier of soya beans to China, the world’s largest consumer of the product.U.S. farmers shipped nearly $20 billion of goods to China in 2017. The American pork industry sent $1.1 billion in products, making China the No. 3 market for U.S. pork.
- The White House’s planned tariffs are partly aimed at punishing Beijing for allegedly stealing American technology and pressuring U.S. companies to hand it over. Observers have suggested that Beijing may be saving stronger retaliatory measures for a response to that White House plan.
- Regardless, many fear escalating trade tensions between Beijing and Washington could damage the global economy. For one, Nobel Prize-winning economist Robert Shiller said, following China’s first threat of tariffs on 128 products, that uncertainty about tit-for-tat trade measures could result in an “economic crisis.”Beijing has urged Washington to resolve the matter through dialogue and negotiation.
Source :Livemint