China hits back at USA with $60bn tariff threat

China threatens tariffs on $60 billion in US goods

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China today announced a $60 billion list of us goods including coffee, honey and industrial chemicals for retaliation if Washington goes ahead with its latest tariff threat.

The Chinese finance ministry said 5,207 goods imported from the U.S. could be subjected to the fresh tariffs, with levies ranging from 5% to 25% on products including aircraft, soya bean oil, smoked beef, coffee and flour.

The retaliation stands to further inflame tensions between the world's two biggest economies and echoes China's response to the previous round of tariffs, which took effect last month.

Last month, the USA and China imposed tariffs on US$34 billion of each other's imports, with Washington expected to levy more tariffs on another US$16 billion of Chinese goods in the coming weeks, a move that China has said it will match.

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.

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President Donald Trump's administration has imposed duties on steel and aluminum imports, provoking retaliation by the United States' trade partners, including China, Canada, Mexico and the European Union.

But Trump raised the stakes this week with his threat to raise the tariff rate.

The last time China was hit hard by growth fears, the shock waves rattled financial markets around the world, including in the U.S. In August 2015, the People's Bank of China stunned investors by lowering its target level for the yuan against the dollar, triggering a global selloff in stocks.

China has said new duties will be applied only if Washington pulls the trigger on its new tariffs. "China trade battle. But I expect this will be resolved long before the Alaska project gets its federal building permit in spring 2020".

"Any unilateral threat or blackmail will only lead to intensi-fication of conflicts and damage to the interests of all parties", said the statement.

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In an editorial on Wednesday, the state-run China Daily called the US' move "gangsterism", and said it showed the U.S. had no qualms about squeezing as much as it could from trade partners. China says if that happens, it will follow through with its taxes, which will range from 5% to 25%.

Beijing can not match those measures dollar for dollar, as its exports far exceed imports.

Trump announced a further round of 25 percent of tariffs June 15 on $50 billion worth of Chinese goods.

"The Chinese are also coping by lowering the rate of the yuan, while the USA can look towards countries in Southeast Asia as replacements for its imports, so it's not a big issue".

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The ministry also said the U.S. measures violated World Trade Organisation rules and damaged China's interests. But Kudlow's toughest words came about the Chinese economy itself, which is second only to the United States.

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