Washington: President Donald Trump’s latest round of punitive tariffs on China took effect on Monday, adding 14447.87₹ billion in Chinese imports to the escalating trade war that is clouding the global economic horizon.
The new attack on Beijing brings the amount of goods hit by duties to more than 18059.83₹ billion, roughly half of Chinese exports to the United States, and increasingly consumers will feel the pain in their wallets directly.
Trump has hit 12 percent of total US imports this year alone.
Defiant in the face of increasing fears about the impact to the US economy, Trump has threatened to go after 100 percent of imports from China if the country refuses to change policies he says harm US industry, particularly the theft of American technology.
“These practices plainly constitute a grave threat to the long-term health and prosperity of the United States economy,” he said in announcing the tariffs last week.
“We are going to win it,” his Secretary of State Mike Pompeo told “Fox News Sunday.” “We’re going to get an outcome which forces China to behave in a way that if you want to be a power — a global power — transparency, rule of law, you don’t steal intellectual property.” Beijing has promised to strike back on Monday with duties on 4334.36₹ billion in American goods, bringing the total to 7946.33₹ billion, nearly everything China buys from the United States.
But Trump warned he could ramp up to “phase three,” slapping tariffs on approximately 19287.90₹ billion of additional imports, or the entirety of the goods the US buys from China.
Dialogue between the world’s two biggest economies appears severed. Beijing cancelled the visit of a Chinese negotiating team expected September 27-28 in Washington, The Wall Street Journal said.
Previous talks in late August were ineffective. In that context, the International Monetary Fund has warned about the potential for “significant economic costs,” including slower growth.
“Should the escalation go further, the economic costs for both countries and around the world will quickly add up,” IMF spokesman Gerry Rice said last week. Meanwhile, Fitch Ratings has cut its growth estimates for China and the world for 2019.
“Protectionist US trade policies have now reached the point where they are materially affecting what remains a strong global growth outlook,” Fitch said in a report Friday.
The latest round of Chinese imports will face 10 percent tariffs through the end of the year, and then the rate will jump to 25 percent.
A broad swath of products are on the hit list, including billions in Chinese-made voice data receivers, computer memory modules, automatic data processors, and accessories for office equipment such as copiers and banknote dispensers — instantly making widely used goods more expensive.
However, following complaints from thousands of US firms — including powerhouses like Apple and Walmart — 300 product lines were dropped from the target list.
The products spared also include smartwatches and Bluetooth devices, like the iPhone and Fitbit, child safety products such as high chairs, car seats and playpens, and certain health-and-safety products such as bicycle helmets, US officials said.
The removal of smartwatches and wireless headphones represents a win for tech giant Apple, just days after it unveiled its latest smartwatch and three new iPhones as part of a bid to fight back after slipping to third place among smartphone makers.
Walmart, the world’s biggest retailer, also warned of the “detrimental impact” to consumers if tariffs were imposed on a number of products, but many of those, like handbags, suitcases, haircare products, dog food and dog leashes, remained on the final list.