U.S., China fire first shots in tariff war

09 Julio, 2018, 19:36 | Author: Arnold Perez
  • WASHINGTON DC- JULY 05 U.S. President Donald Trump waves from the North Portico of the White House while departing on a trip to Wyoming to attend a Make America Great rally

Acadiana soybean farmers are bracing for the worst case scenario after China imposes tariffs on American products.

Mr. Sheng added that the USA has maintained a services trade surplus with China for a long time, which increased incomes in the US and also promoted employment.

The riskiest economic gamble of Trump's presidency could spread as it enters a new and unsafe phase by imposing direct costs on companies and consumers globally. Beijing said it had no choice but to respond in kind by taxing a similar amount of USA goods coming into China.

Despite three rounds of negotiations between the two sides, including a Chinese pledge to significantly increase purchases of American products, Trump chose to go ahead with the tariffs. "If we don't find an exit ramp, this will accelerate like a snowball going down a hill".

There are fears that the tariffs will hit USA jobs as well.

Chinese state media has run numerous commentary pieces on the dispute over the past few days criticizing the American position.

"The Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China", said an English-language article in the China Daily.

At one level, India should welcome China's being called out for its predatory trade and investment policies.

Iconic American companies such as Harley-Davidson Inc. are among those set to suffer. Now that they have gone into effect, the same view is being taken of across-the-board tariffs on autos or of steeper tariffs on Chinese products. American businesses from Apple Inc. and Walmart Inc.to General Motors Co. all operate in China and are keen to expand. It has fallen 9 percent since June 19, when Trump outlined his plans to tax a lot more Chinese imports than he initially proposed.

A DBS analysis shows that South Korea, Malaysia, Taiwan and Singapore are the economies most at risk in Asia based on trade openness and exposure to supply chains. "But Trump obviously wants us to lose this partner". The US rightly argues that China has taken the global trading system for a ride through hidden subsidies, currency manipulation and, more recently, technology theft.

Trump's decision to trigger a trade war isn't confined to the tit-for-tat exchange with China. Failure that brings economic pain could cost Republican seats in November's mid-term elections. A trade war could disrupt these flows and even shift the location of the final manufacture, to avoid penal tariffs in the export destination.

"Our baseline forecast assumes only a modest further escalation in the trade "war" this summer", Bank of America Merrill Lynch said in a Friday note. Surprisingly, the people taking the brunt of the economic hit still largely agree with him, NBC News reports, but how long will that last? "Soybean demand is there, and it's really, really big as soybeans go into different channels".

Noting the launching of Trump's tariffs with the U.S.

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Soybean farmers, apple growers and auto workers are among the USA workers bracing for fallout from a trade war between the United States and China.

He threatened a 10 percent levy on an additional $US200b of Chinese goods if Beijng "refuses to change its practices".

For the time being, analysts say it's hard to see Washington or Beijing backing down in the dispute. But both sides have dug in, and it is unclear what the offramp is for leaders in either country.

The direct impact on China's economic growth in 2018 is estimated at 0.1-0.3 percentage points while the drag on its export growth is expected to be 1 percentage point.

He cited "scaled-up health, safety and tax checks, delaying the import of goods and boycotts of U.S. goods". The threat deepened tensions with the European Union, which warns that vehicle tariffs would inflict pain across its 28 member states.

"We've had meetings with members of Congress to press the issue", said Lee Fuller, a vice president at oil and gas trade group Independent Petroleum Association of America. But recent United States tax cuts and spending increases will probably buoy the dollar and the nation's current-account deficit anyway, the International Monetary Fund said this week.

One of Trump's first acts in office, however, was to withdraw us from this pact.

'We urge the two governments to come back to the negotiation table, ' said Zarit.

The yuan's offshore value rose by as much as 0.5 per cent to 6.6288 per USA dollar on Monday, heading for its biggest daily advance since May 10.

U.S. officials accuse China of building its emerging industrial dominance by stealing the "crown jewels" of American technological know-how through cyber-theft, forced transfers of intellectual property and state-sponsored corporate acquisitions.

As the tariffs approached, the United States central bank warned the impending trade battle was beginning to darken the otherwise blue skies of the robust American economy, now in its 10th year of recovery.

China has vowed to fight back to protect its economy.

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