Published: Fri, June 15, 2018
Money | By Arnold Ball

China promises fast response if US hurts its interests

China promises fast response if US hurts its interests

U.S. President Trump has made up his mind to impose "pretty significant" tariffs on Chinese goods, an administration official said on Thursday, as Beijing warned that it was ready to respond if Washington chose to ratchet up trade tensions.

The Trump administration is announcing a 25 percent tariff on $50 billion worth of Chinese imports, escalating a trade dispute between the world's two largest economies.

The tariffs, which Trump set in motion in March, are a response to China's practice of compulsory technology licensing for foreign companies and its efforts to steal US trade secrets via cybertheft, administration officials have said.

U.S. Treasury Secretary Steven Mnuchin, U.S. Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer were all with Trump in a meeting Thursday when the president made the decision, said White House Press Secretary Sarah Huckabee Sanders, who declined to confirm what was decided. "That is why I am calling on President Trump to fight for American jobs with a comprehensive strategy that puts American economic interests front and centre", she said.

US President Donald Trump has approved tariffs worth $50 billion on import of goods from China.

Some new products will replace some original items on the list to be announced Friday.

"Moving forward with tariffs on goods imported from China will harm USA consumers and businesses, and will fail to change China's discriminatory and damaging trade practices", Dean Garfield, CEO of the Information Technology Industry Council (ITI), said in a statement last month.

Trump said this week he'll confront China "very strongly" over trade in the coming weeks.

"As a soy grower, I depend on trade with China - China imports roughly 60% of total US soybean exports, representing almost 1 in 3 rows of harvested soybeans", Stephens said.

The move is likely to attract retaliatory action by China.

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But his plan to crack down on China has drawn wider support.

It's not clear whether the administration will still target that amount with the list it reveals on Friday.

Trump has frequently cited such an imbalance as the justification for a punitive trade policy toward China, Canada, Mexico, the European Union and other trading partners.

The 25 percent tariffs will target products that contain "industrially significant technologies" in an effort to combat China's alleged theft of USA intellectual property. China has targeted $50 billion in USA products for potential retaliation. The US trade deficit with China was $336 billion in 2017.

"The decision by the US Department of Commerce to impose unreasonably high and prohibitive anti-subsidy and anti-dumping duties on Spanish olives is simply unacceptable", the commission spokesman said. Economists expect the direct impact on the US economy to be modest.

The Chinese have threatened to counterpunch if the president goes ahead with the plan.

The Trump administration could implement the tariffs as soon as next week.

The president has been under pressure from USA lawmakers over his decision to soften a penalty on Chinese telecom-equipment maker ZTE Corp.

The US tariffs are designed specifically to punish China for forcing American companies to hand over technology in exchange for access to the Chinese market. US senators are seeking ways to block the deal in Congress. But Trump said this month ZTE could avoid the ban if it paid at least US$1 billion in penalties, among other things.

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