Friday, July 20, 2018

Business

China vows retaliation over U.S. tariffs

Beijing responds to $200 billion U.S. tariff threat with pledge to take ‘firm and forceful measures’

  • China-US-Tariffs-1

    Imported nuts from the U.S. are displayed for sale Wednesday at a hypermarket in Beijing. China’s government has criticized the latest U.S. threat of a tariff hike as “totally unacceptable” and vowed to retaliate in their escalating trade war. The Commerce Ministry on Wednesday gave no details, but Beijing responded to last week’s U.S. tariff hike on $34 billion of imports from China by increasing its own duties on the same amount of American goods, including nuts.

    Associated Press

  • China-US-Tariffs-1-1

    Chinese-made teddy bears carrying American hit movie Avengers characters are displayed inside an arcade game at a shopping mall in Beijing, Wednesday, July 11, 2018. China's government has criticized the latest U.S. threat of a tariff hike as "totally unacceptable" and vowed to retaliate in their escalating trade war. The Commerce Ministry on Wednesday gave no details, but Beijing responded to last week's U.S. tariff hike on $34 billion of imports from China by increasing its own duties on the same amount of American goods. (AP Photo/Andy Wong)

    Andy Wong

  • China-US-Tariffs-2

    A woman and a child pass Chinese brands of flat screen TVs on display at a hypermarket in Beijing, Wednesday, July 11, 2018. China's government has criticized the latest U.S. threat of a tariff hike as "totally unacceptable" and vowed to retaliate in their escalating trade war. The Commerce Ministry on Wednesday gave no details, but Beijing responded to last week's U.S. tariff hike on $34 billion of imports from China by increasing its own duties on the same amount of American goods. (AP Photo/Andy Wong)

    Andy Wong

  • China-US-Tariffs-3

    Chinese brand home appliances sit on display for sale at a hypermarket in Beijing, Wednesday, July 11, 2018. China's government has criticized the latest U.S. threat of a tariff hike as "totally unacceptable" and vowed to retaliate in their escalating trade war. The Commerce Ministry on Wednesday gave no details, but Beijing responded to last week's U.S. tariff hike on $34 billion of imports from China by increasing its own duties on the same amount of American goods. (AP Photo/Andy Wong)

    Andy Wong

  • China-US-Tariffs-4

    In this July 6, 2018, photo, a truck moves a China Shipping shipping container at a port in Qingdao in eastern China's Shandong Province. China's government on Wednesday, July 11, 2018, has criticized the latest U.S. threat of a tariff hike as "totally unacceptable" and vowed to retaliate in their escalating trade war. (Chinatopix via AP)

    AP

  • China-US-Tariffs-5

    In this July 6, 2018, photo, a container ship is docked at a port in Qingdao in eastern China's Shandong Province. China's government on Wednesday, July 11, 2018, has criticized the latest U.S. threat of a tariff hike as "totally unacceptable" and vowed to retaliate in their escalating trade war. (Chinatopix via AP)

    AP

BEIJING — The Chinese government vowed Wednesday to take “firm and forceful measures” against U.S. threats to expand tariff hikes to thousands of products like fish sticks, apples and French doors as their trade dispute escalates.

China gave no details but earlier threatened “comprehensive measures” if Washington took more action. That prompted fears Beijing, running out of imports for retaliation due to its lopsided trade balance with the U.S., might try to disrupt operations of American automakers, retailers and others that see China as a key market.

The spiraling conflict over Chinese technology policy threatens to chill global economic growth. It stems from Washington’s complaint that Beijing steals or pressures companies to hand over technology and worries that plans for state-led development of Chinese champions in robots and other fields might erode American industrial leadership.

A possible second round of tariff hikes announced Tuesday by the U.S. trade representative targets a $200 billion list of Chinese goods. That came four days after Washington added 25 percent duties on $34 billion worth of Chinese goods, and Beijing responded by increasing taxes on the same amount of American imports.

The abrupt escalation is “totally unacceptable,” said a Commerce Ministry statement. It said Beijing would take unspecified “necessary countermeasures” to protect its “core interests.”

Asked what Beijing would do, Foreign Ministry spokeswoman Hua Chunying gave no details but said, “We will take firm and forceful measures.”

The U.S. trade representative said it was responding to Beijing’s decision to retaliate instead of changing its policies. President Donald Trump has threatened higher tariffs on more than $500 billion of goods, or nearly all of China’s annual exports to the United States.

The trade representative will accept public comments and hold hearings Aug. 20-23 before reaching a decision after Aug. 31, according to a senior U.S. official who briefed reporters on condition of anonymity.

The economic impact of the conflict already is spreading.

The European Union Chamber of Commerce in China said this week its member companies are rearranging the global flow of their goods to make sure any bound for the United States don’t pass through China.

Members of Congress are increasingly questioning Trump’s tactics. They warned tariffs on imports raise consumer prices and expose U.S. farmers and manufacturers to retaliation.

“Tonight’s announcement appears reckless and is not a targeted approach,” Senate Finance Committee Chairman Orrin Hatch, R-Utah, said in a statement.

Investors had been taking the trade war in stride, but Tuesday’s announcement appeared to dent that optimism.

On Wednesday, China’s main stock index lost 1.8 percent, and Japan’s market benchmark fell 1.1 percent. Hong Kong’s main index shed 1.3 percent. All major U.S. indexes fell.

The conflict is “far from over,” warned Hannah Anderson of JP Morgan Asset Management in a report, “and the impact will be global.”


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