Trump threatens new tariffs on Chinese goods worth $200 bn

Washington/Beijing, June 19 

US President Donald Trump has threatened to impose tariffs on an additional $200 billion worth  of Chinese goods unless Beijing ceases its “unfair practices”, escalating a trade war between the world’s two largest economies that jolted the global stock markets.

Trump, pursuing his “America First” policy, has been insisting that China has been unfairly benefitting from a massive trade imbalance with the US, now estimated to be $376 billion.  The White House said that if China goes through with its promise to retaliate against the US tariffs announced last week, the US will impose tariffs on an additional Chinese goods worth $200 billion. “Further action must be taken to encourage China to change its unfair practices, open its market to US goods, and accept a more balanced trade relationship with the US,” Trump said.

The move followed tariffs applied last week on $50 billion in Chinese imports to the US. China responded by saying it would hit 659 US products worth $50 billion.

Trump said he had ordered US Trade Representative Robert Lighthizer to identify a second tranche of goods imported from China for tariffs of 10 per cent. Trump said after the legal process is complete, these tariffs worth $200 billion will go into effect if China refuses to change its practices.

“China has determined that it will raise tariffs on $50 billion worth of US exports. China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology,” Trump said. “Rather than altering those practices, it is now threatening US companies, workers, and farmers who have done nothing wrong,” he said. He said China’s latest action clearly indicated its determination to keep the US at a permanent and unfair disadvantage.

Meanwhile, global stock markets fell today amidst the global concern over a tit-for-tat trade war between the US and China.

In Beijing, China’s Commerce Ministry responded swiftly to Trump’s latest threat, warning that if the US imposed fresh tariffs, China would have to adopt “comprehensive measures combining quantity and quality to make a strong countermeasure.” The US “practice of extreme pressure and blackmail departed from the consensus reached by both sides during multiple negotiations and has also greatly disappointed international society,” it said.

Trump’s latest comments came hours after US Secretary of State Mike Pompeo accused China of engaging in “predatory economics”.

“Chinese leaders have been claiming openness and globalisation, but it’s a joke. Let’s be clear: It’s the most predatory economic government that operates against the rest of the world,” Pompeo said. —  PTI

Why is Trump imposing tariffs?

During the 2016 election campaign, Donald Trump promised to protect American jobs and to renegotiate US trade deficits with countries around the world. The US has the world's largest trade deficit —meaning it buys more goods and services from other countries than it sells overseas — worth $568 bn last year. China is responsible for the bulk of the deficit in terms of goods, exporting $376 bn more to the US than it bought from US producers.