US identifies $50 bn in Chinese imports facing tariffs
"The list of tariffs that the USTR has proposed today would hurt companies in the USA by raising the prices and reducing consumption of the capital equipment they rely on to produce their goods and services", Information Technology and Innovation Foundation (ITIF) President Robert D Atkinson said.
The Chinese tax agency said the date the tariff increases might take effect would be announced later depending on what the U.S. government decides regarding their own list of proposed tariffs.
Some Ohio soybean farmers are anxious the tariffs could impact their exports.
The S&P 500index fell 31 points, or 1.2 percent, to 2,582 as of 9:45 a.m.
The Dow Jones industrial average, which was down 510 points at its low, finished the day up 230.94 points, or almost 1%, at 24,264.
Market responses have justified China's concerns as us agricultural futures plunged across the board.
Last year, the US ran a $375 billion trade deficit in goods with China.
U.S. Commerce Secretary Wilbur Ross said China's response isn't expected to disrupt the U.S. economy.
At a news conference on Wednesday, Chinese officials did little to stem talk of "war", but stressed that Beijing is willing to work with the White House.
"'Trade War' is a convenient shorthand. That is not viable", Chinese Vice Commerce Minister Wang Shouwen told media briefing here today when asked about Trump's demand.
"What we're talking about on both sides is a fraction of 1 percent of both economies", Ross said.
In a tweet after China announced its new list, he said: "We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S".
"We can not dictate a change in trade deficit or surplus".
China had said yesterday that its door for talks with the Trump administration is open but if there is a trade war it will "fight till the end".
China had imposed tariffs on 128 US imports worth Dollars 3 billion, including meat, fruit and pork, as retaliation against taxes approved by US President Donald Trump on imported steel and aluminium.
Stocked plummeted early Wednesday after trade tensions escalated between China and the United States.
Officials at the Office of the US Trade Representative were quoted as saying the proposal identified products which "benefit from Chinese industrial policies, including Made in China 2025".
A Commerce Ministry spokesman said the planned USA tariff hike "publicly violates WTO rules". If demand for USA government bonds shrinks, interest rates could rise in the United States, undermining private investment and overall economic activity in the world's largest economy. Farm states generally backed Trump in the 2016 election and their exports could be hurt. In an email on Wednesday, Paul Burke, North Asia Regional Director of the U.S. Soybean Export Council, said duties on soybeans will hurt both U.S. farmers as well as Chinese soy processing, animal producers and consumers.
FILE PHOTO: The Boeing building is seen next to Boeing Field in Seattle, Washington, U.S., March 26, 2018.
The United States has announced its own tariffs to punish China for stealing trade secrets.
"If the USA decides to increase intensity, China will surely follow suit", said Tu.
"Even though the numbers between China and the USA are comparable, it seems clear that China is trying to twist the knife", he said, "This is a warning that 'we are willing to fight harder and inflict more pain that you are'".
"There is no victor in a trade war, and an initiator will harm itself as well as others", Geng said, noting China had referred the latest USA action to the World Trade Organization.
Fear and uncertainty over a growing trade dispute with China continued to weigh on investors Wednesday, with markets opening sharply lower before recovering by early afternoon.
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