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China hits back at U.S. with $60bn tariff threat

04 August 2018

The step is reportedly being considered by the White House in order to narrow the trade deficit between the U.S. and China. Washington is expected to soon implement tariffs on an additional $16 billion of Chinese goods, which China has already announced it will match immediately.

Chinese and U.S. flags are set up for a signing ceremony during a visit by U.S. Secretary of Transportation Elaine Chao at China's Ministry of Transport in Beijing, China April 27, 2018.

China's imports from the United States past year totaled $153.9 billion.

China's Finance Ministry unveiled the new tariffs on 5,207 goods imported from the U.S. in a statement on its website yesterday evening.

Timing will depend on the actions of the United States, the Chinese Commerce Ministry said in a separate statement.

The Chinese commerce ministry blamed the United States for escalating the situation. "China has to take necessary counter-measures to defend the country's dignity and the interests of the people, defend free trade and the multilateral system, and defend the common interests of all countries in the world".

On March 1, President Donald Trump announced that the USA would be slapping a 25 percent tariff on all steel imports and a 10 percent tariff on all aluminum imports.

"They better not underestimate the President", Mr Kudlow said in an interview on Fox Business Network.
"He is going to stand tough".

Chinese leaders have offered to narrow their politically sensitive trade surplus with the United States by purchasing more American goods.

Trump campaigned on a promise to bring down America's massive trade deficits by renegotiating trade agreements and getting tough on countries like China that sell the USA far more than they buy from it.

The rising tensions have weighed on Chinese stock and currency markets, with the Chinese yuan falling against the dollar. That prompted concern among American companies that retaliation might expand to disrupting their operations in China.

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The two countries have been embroiled for months in a trade conflict that has threatened to hurt consumers in both countries.

Still, two senior diplomats met earlier on Friday on the sidelines of a regional summit in Singapore.

"China always believes that consultation on the basis of mutual respect, equality and mutual benefit is an effective way to resolve trade differences", the Ministry said.

He has previously warned he is prepared to "go to 500", a reference to the £384bn ($500bn) worth of goods Chinese firms sold to the USA a year ago.

"How can talks take place under this pressure?", he added. He told trade officials this week to consider raising that to 25 percent.

They will apply to 5,207 American-made goods, including a range of agricultural products such as vegetable oils, smoked and salted beef, wheat flour and wine. LNG's inclusion marks a deployment by Beijing of one of its last major weapons from its energy and commodities arsenal in its fight with Washington.

Speaking just hours after China unveiled the countermeasures on Friday, Larry Kudlow, Trump's chief economic adviser, said the U.S. president was willing to follow through with his threats, in a stark warning to Beijing.

China would likely hike purchases from Saudi Arabia, Russia, the United Arab Emirates and Iraq if the tariffs slowed USA flows, said Neil Atkinson, head of the oil industry and markets division at the International Energy Agency.

China listed 5,207 USA products that it would target in an effort to "safeguard its own legitimate interests".

The United States was the fourth-largest supplier of foreign chocolate products to China in 2017, worth around $24 million, after Italy, Russia and Belgium, according to customs data.

Small- and medium-sized planes were on the list of goods that would be slapped with an additional 5 percent tariff.

China hits back at U.S. with $60bn tariff threat