Stock markets plummet over Beijing and Washington’s 'trade war’
Hong Kong, Shanghai and Shenzhen suffer losses. Trump signs a memo to apply duties worth $ 60 billion. Beijing imposes duties on 120 types of US products imported for 977 billion and threatens additional tariffs for another 2 billion. The question of intellectual properties. China "is not afraid of a trade war".
Hong Kong (AsiaNews) - The Hong Kong, Shanghai and Shenzen stock markets opened after the two largest world economies decided to launch the first rounds of a possible trade war.
Hong Kong opened down 3.7%; Shanghai at minus 3.27 and Shenzhen at minus 3.62. Even New York, yesterday evening, after the announcement of the new tariffs against China, closed at minus 2.8.
Yesterday afternoon, US President Donald Trump signed a memo to impose tariffs on Chinese imports worth $ 60 billion.
Later, China announced the imposition of 15% tariffs on 120 types of products imported from the US, worth $ 977 billion. There is also the threat that other duties, up to 25% on eight goods worth nearly bn - including port and aluminium scrap.
Trump had promised commercial actions against China since his election campaign. As he was signing of the memo yesterday, he explained that the US suffers from a 375 billion dollar yearly trade deficit with China. This is due to Chinese overproduction (dumping), but also to the support that Beijing gives to exports, facilitating their low cost and imposing themselves on international markets. This is why as early as last January, the US administration had imposed tariffs on steel, aluminium and solar panels imported from China.
Yesterday's decision, however, is also motivated by another fact. Thanks to an investigation carried out last August by US Trade representative Robert Lighthizer, several US companies have openly accused Beijing of obliging them to enter into joint-ventures and transfer technology and trade secrets to their Chinese partners. The US companies claim that they are not given the same freedom as Chinese companies to defend their intellectual property.
According to Trump, the duties imposed yesterday would be equal to the losses that American industries derive from the theft of their intellectual property. The investigation also seems to have demonstrated China's attempts to invest heavily in strategic US industries and to conduct and support hacker attacks.
For this reason, the US is also trying to limit Chinese investments and will bring their grievances on the violation of intellectual property to the World Trade Organization. Lighthizer said that the protection of US technology is very important for the country's economic future.
To avoid a trade war, Xi Jinping had sent two Politburo members, Yang Jiechi and Liu He, to ensure that China is eager to open its market more and more.
Even Premier Li Keqiang, at the conclusion of the National People's Congress, warned against a commercial conflict, which would have "no winner", inviting the US not to act in an "emotional" way.
Today, the Ministry of Commerce in Beijing declared that Trump's decision "creates a very bad precedent" and that China is fully prepared to defend its interests. "China - he reiterates - does not want a trade war, but is not afraid of a trade war".