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USA imposes new tariffs on $200bn of Chinese goods

18 September 2018

Despite the changes, the new tariffs still will cover about US$200 billion worth of additional Chinese goods, as part of an intensifying trade dispute between the world's two largest economies.

"If the U.S. launches any new tariff measures, China will have to take countermeasures to firmly ensure our legitimate rights and interests", Foreign Ministry spokesman Geng Shuang told reporters ahead of the expected announcement.

His administration is planning to announce 10 per cent tariffs on as much as US$200 billion in Chinese goods as soon as Monday, according to five people familiar with the matter.

A 10 percent tariff will go into effect September 24, the president said in a statement, and increase to 25 percent on January 1, 2019.

The U.S. had already imposed tariffs on $50 billion in Chinese imports.

China is one of Apple's largest markets, and the tech giant said increasing tariffs on Chinese goods could harm its business.

The tariffs will be applied to more than 1,000 Chinese products, including consumer goods like electronics, bicycles, tires, and furniture - all pumped out of Chinese factories in vast quantities for cheap export.

The U.S. Treasury had invited Chinese officials, including President Xi Jinping's top economic adviser, to attend talks in Washington this week. Consumer safety products made in China, such as bicycle helmets sold by Vista Outdoor and baby auto seats and other products from Graco Inc also were taken off the list.

Trump is due to make the announcement after the close of US stock markets, where major indices were already sinking sharply in anticipation of what could be a major escalation in the US-China trade conflict.

After a thorough study, the USTR concluded that China is engaged in numerous unfair policies and practices relating to United States technology and intellectual property? such as forcing United States companies to transfer technology to Chinese counterparts, he said.

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Trump has also complained about America's gaping trade deficit - $336 billion previous year - with China, its biggest trading partner.

"They want to make a deal", Trump said.

He also warned that if China retaliated then the U.S. would "immediately pursue phase three" which would mean imposing further tariffs with taxes on another $267bn worth of Chinese products.

The US has "poisoned" the atmosphere for negotiations, Fang said, but added that the two sides can talk about how to cut the US trade deficit with China.

Mr. Trump blasted America's trade track record with China in a meeting on the American workforce Monday afternoon before formally announcing the tariffs. "And that's not including certain items that we won't even talk about".

They officials told reporters the lower initial tariff rate would give U.S. businesses time to find new suppliers.

They also say United States economic growth and inflation are likely to have peaked this year, which could help to further turn the tide of market sentiment against the Dollar over coming months. "I think that kind of tactic is not going to work with China", Fang Xinghai, vice chairman of China's securities regulator, said at a conference in the port city of Tianjin.

Officials from both countries have met four times for formal talks, most recently in August, when Treasury's undersecretary for global affairs, David Malpass, led discussions in Washington with Chinese vice minister Wang Shouwen.

"This is the sixth or seventh time we talked about this particular round of tariffs", said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

USA imposes new tariffs on $200bn of Chinese goods