Fast facts on key developments in the US-China trade war

Sean Reid
July 15, 2018

Last Friday, the US imposed 25 percent tariffs on $34 billion in Chinese products, and Beijing responded by hitting the same amount of USA imports.

China only imported $130 billion worth of goods from the United States a year ago - which is down nearly a third of the value of United States' imports from China. Washington imposed 25 percent tariffs on $34 billion of goods in response to complaints Beijing is hurting American companies by stealing or pressuring enterprises to hand over technology.

The Dow Jones Industrial Average fell almost 220 points Wednesday as U.S. President Donald Trump unveiled new tariffs on Chinese goods.

"For over a year, the Trump Administration has patiently urged China to stop its unfair practices, open its market, and engage in true market competition", said Lighthizer in a July 10 statement. By expanding the list, the administration is beginning to hit products that US households buy, including such things as electric lamps and fish sticks.

Pence cited several exporting opportunities that he said have improved during the Trump administration, including beef to China and poultry to South Korea.

Xu said China exported 54,000 automobiles to the U.S. last year but that figure will be hit by the tariff in the second half of this year. Each side is planning tariffs on a further $16 billion in goods that would bring the totals to $50 billion.

It seems that the U.S. is escalating the scale of this trade friction.

The new tariff will go into effect in August after going through a process of public comment and review and a public hearing, which is scheduled for August.

Hong Kong's main index shed 1.3 percent.

The initial US tariff list focused on Chinese industrial products in an attempt to limit the impact on American consumers.

Some American business groups and senior lawmakers sharply criticized the latest action on Tuesday, with Senate Finance Committee Chairman Orrin Hatch, a Republican, saying it "appears reckless and is not a targeted approach".

Jack Ablin, chief investment officer for Cresset Wealth Advisors, said tariffs can have big effects: a tariff on an import from one country can lead to broad price increases for similar items, and rising taxes and costs might cause companies to change their supply lines in less efficient ways.

Investors fear an escalating Sino-U.S. trade war could hit global growth and damage sentiment. But it also points out that American cars assembled in China will equally bear the brunt of the tariff war.

In regard to auto parts, Xu said Chinese products are no longer made in the US.

China's exports have mushroomed since it joined the World Trade Organization in 2001, making it the world's second-largest economy and prompting widening criticism in recent years from trading partners that it has unfairly used global trade rules to its advantage. The ministry said it would also double efforts to get the World Trade Organisation to block Washington's efforts to penalise China for the wrong reasons.

In its policy agenda released in January, the USA trade office said the WTO needed to change its "self-declare" policy for developing nations to stop major economies like China and India from getting the preferential treatment that should be reserved for the world's poorest nations. That prompted fears Beijing, running out of imports for retaliation due to its lopsided trade balance with the USA, might try to disrupt operations of American automakers, retailers and others that see China as a key market.

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