US President Donald Trump today slapped a stiff 25 per cent tariff on USD 50 billion worth of Chinese goods, as he accused Beijing of intellectual property theft and unfair trade practices, triggering a full-fledged trade war between the world's two largest economies.
In a statement, Trump said 25 per cent tariffs will be applied to Chinese goods that "contain industrially significant technologies." Trade between the two countries "has been very unfair, for a very long time," Trump said, adding that "this situation is no longer sustainable." Trump warned China of more tariffs if Beijing retaliated on today's announcement.
"In light of China's theft of intellectual property and technology and its other unfair trade practices, the United States will implement a 25 per cent tariff on USD 50 billion of goods from China that contain industrially significant technologies," he said.
This includes goods related to China's 'Made in China 2025' strategic plan to dominate the emerging high-technology industries that will drive future economic growth for China, but hurt economic growth for the US and many other countries, he said.
"America can no longer tolerate losing its technology and intellectual property through unfair economic practices," he said.
"These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs," Trump said.
In addition, they will serve as an initial step toward bringing balance to the trade relationship between the US and China, he asserted. Currently, the US has a trade deficit of more than USD 370 billion per annum with China.
Trump warned that the United States will pursue additional tariffs if China engages in retaliatory measures such as imposing new tariffs on US goods, services, or agricultural products, raising non-tariff barriers, or taking punitive actions against American exporters or American companies operating in China".
He reiterated that his friendship with President Xi Jinping and America's relationship with China are both very important to him.
The US says its tariffs on Chinese goods are in response to what it categorises as theft of intellectual property.
Reacting to Trump's latest announcement, China said it has imposed "equal" tariffs on US products.
"It is deeply regrettable that in disregard of the consensus between the two sides, the US has demonstrated flip-flops and ignited a trade war. This move not only hurts bilateral interests, but also undermines world trade order. The Chinese side firmly opposes that," the Commerce Ministry said in a statement.
The Commerce Ministry spokesperson said that China does not want a trade war. However, confronted by such short-sighted act that hurts both the US itself and others, China has no choice but to fight back forcefully to firmly safeguard the interests of the nation and its people and uphold economic globalisation and the multilateral trading system.
It also called on other countries to "take collective action" against the US move, calling it "outdated and backwards behaviour".
The Ministry statement gave no further details of the American products that would be hit. China has previously promised to respond with retaliatory tariffs on US products such as cars, planes and soybeans.
In Washington, US Trade Representative Robert Lighthizer, defending the US move, said, "we must take strong defensive actions to protect America's leadership in technology and innovation against the unprecedented threat posed by China's theft of our intellectual property, the forced transfer of American technology, and its cyber attacks on our computer networks." "China's government is aggressively working to undermine America's high-tech industries and our economic leadership through unfair trade practices and industrial policies like 'Made in China 2025,' Lighthizer said.
The list of products issued by USTR covers 1,102 separate US tariff lines valued at approximately USD 50 billion in 2018 trade values. Trump first announced that the US would impose trade penalties on about USD 50 billion worth of Chinese goods in March.
After China warned it would retaliate, Trump threatened tariffs on a further USD 100 billion worth of Chinese products.
In mid-May, both sides announced a cease-fire after two rounds of trade negotiations. The two sides had said in a joint statement that China would "significantly increase" purchases of US agricultural and energy products to reduce the trade imbalance, a top Trump demand.
Ten days later, the White House abruptly said it would proceed with the tariffs. A further round of trade talks in Beijing earlier this month failed to yield any breakthroughs.
Trump's decision to impose fresh tariffs on China follows his recent imposition of steep tariffs on steel and aluminum imports from Canada, Mexico and the European Union on national security grounds.
Those penalties have been met with consternation by world leaders, and led to a fraught G7 meeting with Canada, France, Germany, Italy, Japan and the UK, last weekend.
The EU and Canada have said they will enact retaliatory tariffs starting in July. Mexico has already retaliated with its own tariffs on US goods.
International Monetary Fund chief Christine Lagarde yesterday warned that the Trump administration's trade policies were likely to hurt the US economy and undermine the world's trade system.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)