Politics

China Escalates Trade Dispute With Tariffs On $3 Billion In US Exports

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China slapped tariffs on up to $3 billion in U.S. exports over the weekend, escalating a trade spat between the world’s two largest economies.

Announced late Sunday, the tariffs will apply to 128 American products that Beijing had previously identified as potential targets for import taxes. The punitive measures went into effect on Monday, the Chinese government said.

Beijing says the tariffs are a response to President Donald Trump’s tariffs on steel and aluminum imports from China and other countries. Last month, Trump invoked a provision of U.S. trade law to place a 25 percent tariff on foreign-made steel and 10 percent on aluminum to protect American “national economic and security.”

Then, on March 22, Trump announced his intention to impose around $60 billion in trade penalties on China for intellectual property theft. Those sanctions, which are likely to hit Chinese aerospace, technology and machinery industries, will not take effect until after a 30-day public review period, according to the White House.

The Chinese tariffs announced Sunday will apply a 15 percent duty on 120 American products such as fruits, nuts and wine, and 25 percent on eight other products, including pork and recycled aluminum. Beijing expects the retaliatory measures to affect about $3 billion worth of goods, less than one percent of U.S. exports to China.

Since first announcing the metal tariffs last month, the White House has said it will give exceptions to several trading partners, including Canada, Mexico, South Korea and the European Union. China has accused the Trump administration of violating global trade rules by invoking national security to place tariffs on Chinese goods, but not imports from other countries.

In a statement late Sunday, China’s Ministry of Commerce said that those exemptions “seriously violate” World Trade Organization rules against trade discrimination among member nations. China’s official news agency, Xinhua, warned that Trump’s plan to impose additional punitive measures are a “self-defeating gamble.”

“Trump’s planned tariffs are not only going to hamper the United States’ economic well-being and continued progress, and burden its people with higher costs of living, but also pose a grave threat to the current global trading system,” Xinhua said, according to CNN.

Chinese trade practices have long been a sore spot for Trump, who has accused Beijing of undermining American producers through intellectual property theft and dumping cheap steel and other products in the U.S. market. Trump said last month he intends to pressure Beijing to develop a plan that would reduce the U.S. trade deficit with China by $100 billion.

China reported a trade surplus of $275.8 billion with the United States last year — about two-thirds of its global total, according to CNBC. Using its own metrics, the U.S. government reported a trade gap of $375.2 billion, the largest ever.

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