China stocks face 'darkest hour' after fresh Trump tariff threat

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"The United States has initiated a trade war and violated market regulations, and is harming the interests of not just the people of China and the U.S., but of the world", the ministry said.

China slapped a 25 percent tariff on 545 American imports including agricultural products, seafood, cars and whiskey.

Zhang said investors faced the triple-whammy of the Sino-U.S. trade spat, Beijing's regulatory crackdown on riskier lending practices and tighter global liquidity.

Trump moved forward with measures after months of sometimes fraught shuttle diplomacy in which Chinese offers to purchase more American goods failed to assuage his grievances over the soaring trade imbalance and China's aggressive industrial development policies.

However, this time, Trump is raising the stakes over the additional $100 billion he previously said he would consider, charging the U.S. Trade Representative to consider $200 billion in additional tariffs on Chinese goods, with yet another $200 billion possible if China refuses to relent.

"If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another $200bn of goods".

The latest round of tariffs would nearly definitely put the U.S. into all-out trade war against China. The Australian dollar, often seen as a proxy to China-related trades, shed 0.25 percent to $0.7404. China threatened retaliatory tariffs of $50 billion this year when Trump first ordered his officials to consider an additional $50 billion.

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US President Donald Trump threatened on Monday (June 18) to impose a 10 per cent tariff on US$200 billion (S$270 billion) of Chinese goods, escalating a tit-for-tat trade war with Beijing.

The intellectual property sanctions were the latest in a spate of protectionist measures unveiled by Mr. Trump in recent months that included tariffs on steel and aluminum imports to the US and a tough rhetoric on trade negotiations from North America to Asia. Three people close to Apple, who remained anonymous because they are not authorized to speak for the company, say that the tech giant's top worry is that the Chinese wreak havoc with Apple's supply chain by forcing suppliers to provide pointless paperwork in order to gum up the works.

"If the United States acts irrationally and issues a list, China will have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures".

Trump's comments come hours after the top USA diplomat accused China of engaging in "predatory economics 101" and an "unprecedented level of larceny" of intellectual property.

China, claiming the United States had "launched a trade war", retaliated nearly immediately, outlining its own tariffs on U.S. goods worth $50 billion.

The US announced plans for tariffs this spring, after an investigation into China's intellectual property practices. On Friday, that list had been reduced to 1,102 items of the same value, with 818 items worth $34 billion set to be hit with tariffs from July, and the $16 billion remainder to undergo further review and a public hearing on July 24 before a final determination is made.

These include major American exports to China such as soybeans, which brought in $14 billion in sales past year and are grown in states that supported Trump during the 2016 presidential election. "However, confronted by such short-sighted act that hurts both U.S. itself and others, China has no choice but to fight back forcefully".

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