Published: Wed, August 08, 2018
Global News | By Blake Casey

Chinese Exports Accelerate As US Prepares New Tariffs In Heated Row

Chinese Exports Accelerate As US Prepares New Tariffs In Heated Row

The step brought the total worth of Chinese goods facing a 25 percent tariff to $50 billion.

"This is a very unreasonable practice", the Chinese commerce ministry said on Wednesday. And President Donald Trump has threatened to impose tariffs on virtually everything China sells to the United States.

The investigation had revealed that China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from USA companies and it deprives USA companies of the ability to set market-based terms in licensing and other technology-related negotiations.

China has now either imposed or proposed tariffs on $110 billion of US goods, representing the vast majority of China's annual imports of American products.

The tranche of 25 per cent tariffs - which covers 279 products including electronic parts, plastics, chemicals, batteries, tractors and railway cars - follows $US34 billion worth of tariffs announced by the USA government in July.

On Tuesday, the Trump administration said it would begin collecting previously announced 25% tariffs on an additional $16bn of Chinese goods from 23 August.

China's surplus with the United States shrank marginally to $28.09 billion last month from a record $28.97 billion in June.

Year-on-year, the growth of China's exports to the United States slowed to 11 percent last month from 12.5 percent in June, while import growth accelerated to 11 percent from 9 percent.

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Although the move was expected, it cements the view that there appears to be no effort underway to defuse the dispute between the world's two largest economies.

The government has responded by releasing more liquidity into the banking system, encouraging lending and promising a more "active" fiscal policy.

Mr Trump has said he would be willing to hit all of China's imports with duties.

Analysts still expect a less favorable overall trade balance for China in coming months given it's early days in the tariff brawl.

In the meantime, it sought public comment on the new items. China in turn retaliated by proposing tariffs on $60 billion worth of USA goods, with the extra levies ranging from 5 to 25 percent.

China has already retaliated against the United States with its own tariffs and proposed others if Washington goes ahead with all its threats. Beijing is expected to hit $16 billion worth of USA goods with equal tariffs in response to Tuesday's move.

John Neuffer, president and CEO of the Semiconductor Industry Association, said in a statement they were disappointed and puzzled why semiconductors remain on the final tariff list.

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