The hypothesised trade war between China and America is getting closer with every day. Trump has implemented a new scheme to put America first by increasing an import tariff on aluminium and steel to the country. Australia among other nations have already been exempt from the tariff increase however China was not one of them.
In retaliation, China placed tariffs on US goods such as fruit, nuts and pork products. The increase on the tariffs could see America paying an extra $3billion USD to export their products into China.
What seems to be a back and forth display of who the tougher country is, Trump has threatened to place more tariffs on Chinese products that range from ball bearings to bakery ovens. The proposed retaliation to the retaliation could cost China $50 billion USD on their imported goods.
On the 22nd of March, the Trump administration took action against allegations that Beijing is forcing companies in the US to transfer their technology as a condition for doing business in China. Earlier this week the list that is proposed will subject 1,300 products to new tariffs.
The total value of the tariffs on these items is said to equal the amount that US businesses have to pay for doing business with China. All of the products on the proposed list are said to have a 25 percent tariff increase with a specific aim of targeting Chinese manufacturing sectors that have been accused of supporting companies and programs that are backed by the state.
A lot of the major US business groups expressed their opinion that the tariffs placed by China however they also recognise the need to improve trade relations with the Country.
Myron Brilliant, the head of international affairs and Executive Vice President, stated that imposing taxes on products that are used regularly by American businesses and consumers is not the right course of action to amend the trade relations. He also stated that the US chamber is looking forward to working with the Trump administration to work through the current issue of the China economic relationship.
Cui Tiankai who is China’s ambassador to the US stated earlier in the week that China will definitely take countermeasures to the new tariffs that are being put in place. As the nation was so quick to respond to the aluminium and steel tariffs, it is no surprise that they will act on the same scale with the same intensity as the US.