The tit-for-tat conflict between the United States and China — the world’s two largest economies — is poised to escalate from there. The rhetoric is already intensifying.
“We oppose the act of extreme pressure and blackmail by swinging the big stick of trade protectionism,” a spokesman for China’s Commerce Ministry said Thursday. “The U.S. is abusing the tariff methods and starting trade wars all around the world.”
Cecilia Malmstrom, the E.U.’s trade commissioner, acknowledged that the bloc had targeted some iconic American imports for tariffs, like Harley-Davidson motorcycles and bourbon, to “make noise” and put pressure on U.S. leaders.
John Murphy, a senior vice president at the U.S. Chamber of Commerce, estimates that $75 billion in U.S. products will be subject to new foreign tariffs by the end of the first week of July.
“We’ve never seen anything like this,” said Mary Lovely, a Syracuse University economist who studies international trade — at least not since countries tried to wall themselves off from foreign competition during the Great Depression.
As painful as the brewing trade war could prove, many have seen it coming.
Trump ran for the presidency on a vow to topple seven decades of American policy that had favored ever-freer trade among nations. He charged that a succession of poorly negotiated accords — including the North American Free Trade Agreement and the pact that admitted China into the World Trade Organization — put American manufacturers at an unfair disadvantage and destroyed millions of U.S. factory jobs.
He pledged to impose tariffs on imports from countries that Trump said had exploited the United States. Late last month, Trump proceeded to infuriate U.S. allies — from the EU to Canada and Mexico by imposing tariffs of 25 percent on imported steel and 10 percent on aluminum. The president justified the move by saying imported metals threatened America’s national security — a dubious justification that countries have used rarely because it can be so easily abused.
And he is threatening to impose another national security-based tariff on imports of cars, trucks and auto parts.
Trump has also started a trade fight with China over Beijing’s sharp-elbowed efforts to overtake U.S. technological dominance. China’s tactics range from forcing American companies to hand over technology in exchange for access to the Chinese market to outright cyber-theft.
The White House last week announced plans to slap 25 percent tariffs on 1,100 Chinese goods, worth $50 billion in imports. Trump would start July 6 by taxing $34 billion worth of products and later add tariffs on an additional $16 billion in goods.
The Chinese have said they will respond in kind. Trump said he would then retaliate against any counterpunch from Beijing by targeting an additional $200 billion in Chinese products, and then yet another $200 billion if China refused to back down. All told, the $450 billion in potential tariffs would cover nearly 90 percent of goods China sends to the United States.
The tariffs and threats have begun to take a toll. Steel and aluminum prices, for example, have shot up and supplies have become scarce.
Visit the Source: https://www.nbcnews.com/news/world/trump-jabbed-first-now-world-hits-back-trade-fight-n885636?cid=public-rss_20180623