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The U.S. on Tuesday set a wide-ranging list of $16 billion worth of Chinese goods that will be hit with a 25 percent tariff later this month in the latest trade escalation between Washington and Beijing.
Customs and Border Protection will start to collect the duties on 279 of an original list of 284 product lines beginning Aug. 23, according to the Office of the U.S. Trade Representative.
Affected goods include AC and DC motors, voltage-current regulators, steam turbines, railway cars, antennas and integrated circuits.
China's exports surged more than expected in July despite U.S. duties and its closely watched surplus with the United States remained near record highs, as the world's two major economic powers ramp up a bitter dispute that some fear could derail global growth.In the latest move by President Donald Trump to put pressure on Beijing to negotiate trade concessions, Washington is set to begin collecting 25 percent tariffs on another $16 billion in Chinese goods on Aug. 23.In a statement on its official website late on Wednesday, China's commerce ministry criticised the U.S. move as being "unreasonable", saying it had no choice but to adopt the same measure on an equal amount of American goods ranging from oil and steel products to autos and medical equipment.Wednesday's Chinese data provide the first readings of the overall trade picture for the world's second-largest economy since U.S duties on $34 billion of Chinese imports came into effect on July 6.All the same, China's exports for July rose a bigger than expected 12.2 percent year-on-year, showing little tariff impact for now and beating June's 11.2 percent rise and analysts expectations in a Reuters poll for 10 percent growth.Of more direct consequence in the Sino-U.S. trade war, China's surplus with the United States shrank only marginally to $28.09 billion last month from a record $28.97 billion in June. Washington has long criticised China's trade surplus with the United States and has demanded Beijing cut it.Those demands could get even more strident if the yuan's sharp drop in recent months raises the ire of the United States, which has in the past repeatedly criticised Beijing for manipulating its currency to gain an unfair trade advantage.Economists say China appears to be taking a more hands-off approach to the yuan, which marked its worst 4-month fall on record between April and July and has provided some reprieve for exporters in the face of the rising trade tensions.ANZ senior China economist Betty Wang said Beijing will likely resist using its closely managed currency as a tool in the trade war. "Currency devaluation, which may have helped exports to some extent, has been largely market-driven in our view and is not a preferred policy tool by Chinese policy makers as part of the retaliation measures," Wang said.China's trade with the U.S. also continued to rise in July despite the tariffs, with exports up 11.2 percent year-on-year, and imports increasing 11.1 percent.Analysts still expect a less favourable overall trade balance for China in coming months given it's early days in the tariff brawl.BEIJING BOOSTS LIQUIDITY SUPPORTAfter a strong start to the year, growth in the world's second-largest economy cooled slightly in the second quarter, partly hit by the government's years-long efforts to tackle debt risks.China's imports rose 27.3 percent year-on-year in July, in a sign domestic demand remains solid, but the worry is that the escalating Sino-U.S. trade war, rising corporate bankruptcies, and a steep decline in the yuan could put a significant dent on the economy.The government has responded by releasing more liquidity into the banking system, encouraging lending and promising a more "active" fiscal policy.World financial markets have taken a battering in recent months as fears grow that Trump's "America First" policies could derail a global economic revival.Several large American companies have said they would adjust their supply chains to source outside of China if tariffs on Chinese goods impacted them, while China's Haier Group said rising steel prices amid hefty U.S. import tariffs was driving up costs for its business in America.In a sign there may be more difficulties ahead, a private survey last week found that the business outlook among Chinese services firms was the second-weakest on record in July in part due worries about the trade war."STICK OF HEGEMONY"China has repeatedly warned it will strike back against any further punitive measures by Trump, saying the United States is threatening the global free trade order with its protectionism.Chinese state media, reflecting the government's stance, has said China will not be cowed in the face of U.S. threats.The latest commentary from state media on Wednesday took a softer line after resorting to personal attacks against Trump earlier in the week, saying China could get through the storm but refrained from directly mentioning the U.S. president.All China's main state newspapers published a lengthy commentary by the official Xinhua news agency, entitled "declaration", on their front pages."Certain people go against the tide for their own private ends and go against morality; the barrier of tariffs wantonly rise, and the stick of hegemony is raised all around," the commentary said."Although this may for a moment bring preening with delight, it will make it hard to resolve economic imbalances or out of kilter politics and other deep-rooted problems," it said.China has not yet given a date for its previously announced retaliatory tariffs on $16 billion in U.S. goods, which will target commodities such as crude oil, natural gas, coal and some refined oil products.The latest $16 billion list from the United States will hit semiconductors from China, even though many of the basic chips in these products originate from the United States, Taiwan or South Korea.John Neuffer, president and CEO of the Semiconductor Industry Association, said in a statement they were disappointed and puzzled why semiconductors remain on the final tariff list."We have made the case to the Administration, in the strongest possible terms, that tariffs imposed on semiconductors imported from China will hurt America's chipmakers, not China's, and will do nothing to stop China's problematic and discriminatory trade practices," he said.India doubles import tax on textile products, may hit ChinaChina congratulates Zimbabwe after disputed voteTrump's trade 'extortion' won't work: Chinese state media
Chinese exports accelerate as US prepares new tariffs
The U.S. in early July imposed 25 percent tariffs on $34 billion in Chinese goods, roiling Beijing, who struck back with an equivalent amount of levies on U.S. goods.
China announced last Friday it plans to impose tariffs of up to 25 percent on $60 billion of U.S. goods as the trade salvos between the world's two largest economies continued.
In the interim, the U.S. is readying 10 percent tariffs on an additional $200 billion worth of Chinese goods.
The U.S. has been seeking to have China reverse course on what it calls Beijing's "unreasonable and discriminatory" policies related to technology transfer and intellectual property and to narrow the trade deficit.
Chinese state media on Monday lashed out at U.S. President Donald Trump's trade policies in an unusually personal attack, and sought to reassure investors worried about China's economy as growth concerns rattled its financial markets.China's strictly controlled news outlets have frequently rebuked the United States and the Trump administration as the trade conflict has escalated, but they have largely refrained from specifically targeting Trump.The latest criticism from the overseas edition of the ruling Communist Party's People's Daily newspaper singled out Trump, saying he was starring in his own "street fighter-style deceitful drama of extortion and intimidation".State media says China's response to latest US tariffs restrained, rationalTrump's desire for others to play along with his drama is "wishful thinking", a commentary on the paper's front page said, arguing that the United States had escalated trade friction with China and turned international trade into a "zero-sum game"."Governing a country is not like doing business," the paper said, adding that Trump's actions imperilled the national credibility of the United States.The heated dispute between the world's two biggest economies has roiled financial markets including stocks, currencies and the global trade of commodities from soybeans to coal in recent months.Trump adviser Kudlow warns China after new tariffs announcedThe United States and China implemented tariffs on $34 billion worth of each other's goods in July. Washington is expected to soon implement tariffs on an additional $16 billion of Chinese goods, which China has already said it will match immediately.On Friday, China's finance ministry unveiled new sets of additional tariffs on 5,207 goods imported from the United States worth $60 billion.That move was in response to the Trump administration's proposal of a 25-percent tariff on $200 billion worth of Chinese imports.The trade war, rising corporate bankruptcies, and a steep decline in the value of the yuan versus the dollar have raised concerns that China's economy could face a steeper slowdown.China unveils retaliatory tariffs on $60 billion of US goodsThe government has responded by releasing more liquidity into the banking system, encouraging lending and promising a more "active" fiscal policy.U.S. companies are putting in place measures to cushion the impact of the trade row, including price hikes, and a number of companies - from industrial firms to home furnishers and toymakers - have said they will move some sourcing and manufacturing outside of China.STOCK MARKET SWINGSThe paper's vitriol follows Trump's comments on Twitter from Saturday in which he boasted that his strategy of placing steep tariffs on Chinese imports was "working far better than anyone ever anticipated", and that Beijing was now talking to the United States about trade.Trump cited losses in China's stock market as he predicted the U.S. market could "go up dramatically" once trade deals were renegotiated.China's stocks were lower on Monday as Beijing's latest tariff threats escalated the tit-for-tat Sino-U.S. trade war, though the central bank's efforts to shore up the tumbling yuan helped to stabilise the currency.But a flurry of articles in Chinese state media emphasised the resilience of China's economy and downplayed concerns about the impact of the Sino-U.S. trade war."Market participants foresee a relatively stable Chinese currency in the near term, without fear of impacts from the U.S.-China trade dispute. They expect solid economic growth momentum amid policy fine-tuning," an article in the official English-language China Daily newspaper said, citing Chinese economists.On Friday, the People's Bank of China said it would require banks to keep reserves equivalent to 20 percent of their clients' foreign exchange forwards positions from Monday, in a move to stabilise the yuan."Leading China's economy on a stable and far-reaching path, we have confidence and determination," another commentary in the main edition of the People's Daily said.Trump has threatened tariffs on over $500 billion in Chinese goods, covering virtually all U.S. imports from the Asian giant, demanding that Beijing make fundamental changes to its policies on intellectual property protection, technology transfers and subsidies for high technology industries.The nationalist Global Times, responding in an editorial late on Sunday to White House economic adviser Larry Kudlow's remarks that China should not underestimate Trump's resolve, said China did not fear "sacrificing short-term interests"."China has time to fight to the end. Time will prove that the U.S. eventually makes a fool of itself," the Global Times said. Hardline US 'gundamentalists' pressure NRA from withinTrump aims tweet at LeBron James, questions his intelligenceTrump administration misled public on poverty: Report
Trump's trade 'extortion' won't work: Chinese state media
A report released by the Trade Representative in March determined China "uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from U.S. companies" and "deprives U.S. companies of the ability to set market-based terms in licensing and other technology-related negotiations."
It further said China conducts and backs hacking efforts targeting U.S. companies that seek to steal business secrets.
President Donald Trump's National Economic Council director, Larry Kudlow, warned China against underestimating the president, saying "China knows what we are asking, they just have not made satisfactory responses."
The U.S.-China trade relationship is estimated at $650 billion annually. But the U.S. imports far more from China than it exports.
U.S. exports to China totaled $169.8 billion in 2016, while imports hit $478.8 billion that year.