Tariff war intensifies with new round of duties between Beijing and Washington
The maneuver announced by the US enters into force on 23 August: the total value is 16 billion dollars and covers 279 products made in China. The Chinese State Council reacts with an identical countermeasure. The markets hold for now, but the fear is that in the long run global production will be affected.
Beijing (AsiaNews / Agencies) - China and the United States continue to impose import duties on each other, enacting a trade war that risks impacting global production in the long run. Washington announced yesterday that from next August 23, 25% duties will be applied on products imported from China for a value of 16 billion dollars.
These include 279 products ranging from motorbikes to railway carriages. These duties are follow an earlier package of tariffs issued July 6, again at 25% for a value of 34 billion dollars. And US President Trump has made it clear that it could reach another $ 200 billion.
Immediately after this announcement, the Chinese State Council clarified that "it considers it necessary to resolve this trade war through negotiations", but added that the blame for the aggravation of the situation "clearly lies with America" and stressed that Beijing will respond "dollar for dollar". Soon after, a list of US products was issued that will suffer a 25% increase in taxation.
The list includes spare parts for wheelchairs, bicycles and mopeds, magnetic resonance equipment, laboratory equipment and tools for ophthalmology and surgery, trailers for vans, mothballs, racing bikes, a whole range of vehicles, including diesel engine SUVs, but also cars with 4. litre cc engines, snowblowers, trucks for the transport of bulky loads. Moreover, Beijing has made it clear that it could soon act against US companies on its territory: the worst hit, experts explain, would be Apple.
Despite the announcements, international markets have reacted well and China has proven stable in its trade balance. The surplus with the United States fell slightly (by 2.8%) in July, after registering a record in June. The surplus was 28.09 billion dollars to the US, when in June it was 28.9 billion. However, the surplus remains up 11% over the year.
In general, Chinese imports jumped 27.3% compared to July 2017, beating the + 16.5% expected by the market, while exports rose 12.2% (consensus + 10%), with the resulting worsening of the overall trade balance . The long-term concern for a trade war remains: according to Oxford Economics, global production will be reduced by 0.7% by 2020, with China and US GDP impacted by 1.3% and 1% respectively.