The Chinese government made a decisive move in reaction to the tariffs imposed by the Trump administration that harmed China by implementing their own tariffs against American goods, ranging from soybeans to cars and other exports.
According to reports, Beijing announced a plan on Wednesday that would put 25 percent tariffs in place on imports of American goods. The tariffs list 106 products, including U.S. automobiles, airplanes, and soybeans. The sum of the package is approximately $50 billion of U.S. goods.
It was also noted that other foreign markets were to be impacted by the announcement. In South Korea, the main stock exchange slid more than 1 percent. European markets also slid as a consequence of China’s plan.
The announcement, of course, came in response to the White House releasing a similar $50 billion tariff that targetted Chinese goods over so-called unfair trade practices. The list of goods included 1300 Chinese products. 25 percent tariffs were implemented on Chinese furniture, shoes, electronics, and other goods.
On Sunday, China had announced another tariff package that targetted U.S. pork and fruit in response to President Trump’s original decision to raise duties on imported steel and aluminum.
Often compared to the Smoot-Hawley Act of 1930, which sharply raised tariffs on approximately 20 thousand goods produced overseas and exported to the U.S., Trump’s signing of the tariffs on steel imports was immediately criticised by lawmakers, economists, and advisors.
Many feared a significant trade war with China, which is now continuing to develop.
President Trump argues that China has been unfair to the U.S. and that we need to resolve the massive deficit. The Chinese government has been acting in reaction to the American aggression.
Some U.S. lawmakers have gone further to warn of a possible global crisis due to Trump’s actions in targetting China.
Professional economic firms have also warned that protectionist policy could have negative effects on domestic consumers.
“While we are pleased that many everyday products such as clothing and shoes are not on the list, we remain concerned that other goods such as consumer electronics and home appliances are targets,” National Retail Federation President and CEO Matthew Shay stated.
Trump has dismissed the concerns.
“We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!” the president tweeted.
We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!
— Donald J. Trump (@realDonaldTrump) April 4, 2018
H/T: The Hill