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US, China trade war deepens as Trump threatens additional tariffs

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6 years ago

April 6, 2018

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China said on Friday it was ready to pay “any cost” in a possible trade war with the US, after President Donald Trump warned he was considering $100 billion in extra tariffs.

“In light of China’s unfair retaliation, I have instructed the USTR to consider whether $100bn of additional tariffs would be appropriate under section 301 and, if so, to identify the products upon which to impose such tariffs,”Trump said in a statement issued by the White House.

“Rather than remedy its misconduct, China has chosen to harm our farmers and manufacturers,” he added.

China said it would respond with “new comprehensive countermeasures”.

“If the US side disregards opposition from China and the international community and insists on carrying out unilateralism and trade protectionism, the Chinese side will take them on until the end at any cost,” the Ministry of Commerce said in a statement on its website.

The move threatens to unravel efforts by top US and Chinese trade officials to lower the heat and reach an agreement that could stave off a full-blown trade war that could harm the world’s two largest economies.

“This is what a trade war looks like, and what we have warned against from the start,” said National Retail Federation President and CEO Matthew Shay.

“We are on a dangerous downward spiral and American families will be on the losing end,” Mr. Shay added in a statement, urging Trump “to stop playing a game of chicken with the US economy.”

China said on Wednesday it would levy a 25pc tariff on about $50bn of US imports including soybeans, automobiles, chemicals and aircraft. That was in response to the release by the US of a list of proposed tariffs a day earlier, covering $50bn in Chinese goods.

Larry Kudlow, Trump’s Chief Economic Adviser, and other administration officials have spent the past two days trying to dampen fears of a trade war.

“I think we’re going to come to agreements,”Kudlow said Wednesday on Fox News. “I believe that the Chinese will back down and will play ball.”

He said on Thursday the administration was involved in “delicate negotiations” that might forestall the need for tariffs. He said the US could still hammer out a deal with Beijing, in part by convincing other major economies to call out the Asian nation for unfair trading practices.