U.S. And China Impose Fresh Tariffs As Trade War Escalates

US-China trade war escalates as new tariffs kick

If the White House continues to raise trade barriers, the purchasing power of US households will be reduced, the officials said, according to a report from Agence France-Presse.

Yet Beijing is not backing down despite insistence from Washington that it put the breaks on a technology development strategy that, according to the US, features unfair trade practices.

U.S. President Donald Trump has threatened to put duties on nearly all of the more than $500 billion in Chinese goods exported to the United States annually unless Beijing agrees to sweeping changes to its intellectual property practices, industrial subsidy programs and tariff structures, and buys more U.S. goods.

Meanwhile, a Reuters poll of more than 100 economists shows that a lot of them expect economic growth to slow over the next two quarters as the boost created by last year's tax cuts fades and Americans begin to feel the costs of the tariffs.

China's tariff list covers 333 products including large passenger cars, motorcycles and baby carriages.

In the first round of tariff hikes on July 6, US President Donald Trump imposed 25 percent duties on US$34 billion of Chinese imports.

But so far the Trump administration has largely been deaf to the complaints, as only a handful of product lines have been shielded from the punitive duties.

U.S. Treasury officials have been working on a revised list of American demands in the lead-up to this week's meetings, according to people familiar with the U.S. preparations.

Economists reckon that every US$100 billion of imports affected by tariffs would reduce global trade by around 0.5 per cent.

China has responded by threatening to impose new tariffs on $60 billion worth of U.S. goods, while Beijing could also target the local operations of USA corporations with inspections and boycotts as it has done in past disputes with South Korea and Japan.

The trade war between rival economic powerhouses has escalated despite the meeting between United States and Chinese officials on Wednesday in Washington for a futile attempt to avert further economic clashes.

The tariffs took effect this morning amid two days of talks in Washington between officials from both sides. Beijing had responded in kind. Previous negotiations failed to produce any lasting deals, and President Donald Trump has suggested the current talks may not be much different.

The US moves were "clearly suspected" of violating World Trade Organisation rules, the commerce ministry said in a statement, adding that it would file a lawsuit against them under the WTO's dispute resolution mechanism.

A spokeswoman at China's embassy in Washington could not immediately be reached for comment.

Though it is too early for trade damage to show up in much economic data, tariffs are beginning to increase costs for consumers and businesses on both sides of the Pacific, forcing companies to adjust supply chains and pricing, with some US companies looking to decrease reliance on China.

"In order for us to get a positive result out of these engagements, it's really critical that they (China) address the fundamental concerns that we have raised", the official said on a press call on the new USA security review law for foreign acquisitions.

In an interview with the business channel CNBC, he said, "I'm willing to go to 500", referring roughly to the $505.5 billion in goods imported a year ago from China. China's retaliatory tariffs apply to USA goods including coal, petrol, vehicles, motorcycles and medical equipment.

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