China counter-punches against U.S. in growing trade war

39;Promises made promises kept': Mr Trump has vowed to clamp down on 'unfair' trade deals

Image 'Promises made promises kept': Mr Trump has vowed to clamp down on 'unfair' trade deals

"China trade war, and let's hope it's not Fort Sumter", the piece began.

With the United States and China finally formalizing tit-for-tat import tariffs, Wall Street is gearing up to dissect US corporate earnings in the coming weeks for signs of a trade war impact and whether it will affect spending plans.

American companies doing business in China are particularly anxious.

The U.S. runs a bilateral trade deficit of $336 billion with China and imports much more from it than the reverse, giving it an early advantage. "Soybean demand is there, and it's really, really big as soybeans go into different channels".

And Trump said Thursday that higher tariffs on an additional $16 billion of Chinese goods are coming in the next two weeks, setting up what could be a tariff on $550 billion worth of goods - more than the $506 billion in Chinese imports past year.

Economists say that if the back-and-forth stops there, the overall impact on both economies will be minimal even though some industries will suffer.

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Beijing hit back on Friday with tariffs worth $34bn and has said it will match Trump's $50bn threat.

The president upped the stakes on Thursday, saying the amount of goods subject to tariffs could rise to more than $500bn.

"You have another 16 (billion dollars) in two weeks, and then, as you know, we have $200 billion in abeyance and then after the $200 billion, we have $300 billion in abeyance. Ok?" The US rightly argues that China has taken the global trading system for a ride through hidden subsidies, currency manipulation and, more recently, technology theft.

The managing director of the Association of German Chambers of Trade and Commerce, Martin Wansleben, also spoke out Monday in favor of strengthening economic relations between his country and China.

The dispute has roiled financial markets including stocks, currencies and the global trade of commodities from soybeans to coal in recent weeks. It also is rooted in the clash between American notions of free trade and Beijing's state-led development model.

Trump has said the European Union is "possibly nearly as bad as China" when it comes to trade, as a raft of retaliatory tariffs from Brussels came into effect on June 22. Certain products are even more imbalanced, for instance the United States charges a 2.5 percent tariff on Chinese cars, while China now maintains a 25 percent tariff on cars from the United States.

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For the time being, analysts say it's hard to see Washington or Beijing backing down in the dispute.

Meanwhile, NBC News reports red-state farmers, who voted overwhelmingly for President Trump, are bracing for the fall-out of what's shaping up to be a nasty trade war.

After that, the hostilities could intensify: Trump said Washington is ready to target an additional United States dollars 200 billion in Chinese imports - and then USD 300 billion more - if Beijing does not yield.

The two giant economies appear ready to see which side can endure the most pain.

A spokesperson for the Alliance of Automobile Manufacturers said in an email Friday that some U.S. carmakers may not feel a major impact right off the bat.

He said China imposes contractual restrictions on the licensing of intellectual property and technology by foreign firms into China, but does not put the same restrictions on contracts between two Chinese enterprises. Hu gave no details, but the Communist Party newspaper People's Daily said the customs agency was carrying out a plan announced last month to impose 25 percent tariffs on a $34 billion list of American goods including soybeans, pork and electric cars. But it's clear our unilateralism and contempt for worldwide trade rules have given China an opening that should never have existed in the first place, especially since Europe has virtually the same complaints about Chinese trade practices that we do.

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The Retail Industry Leaders Association said new tariffs on Chinese imports would punish American families by driving up prices. Trump will mount as the economic pain spreads from affected companies to be more widely felt by consumers.

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