Published: Fri, June 22, 2018
Business | By Eloise Houston

Trump threatens additional tariffs on $200 billion of Chinese goods

Trump threatens additional tariffs on $200 billion of Chinese goods

"People living in Canada are coming to the United States and smuggling things back into Canada because the tariffs are so massive", Trump said Tuesday. The president threatened that they would activate these additional taxes if China continues in its "unfair practices related to the acquisition of American intellectual property and technology".

Shares of Boeing, which has been a proxy for trade-war tensions with China, fell 3.8 percent, weighing the most on the Dow. "This would likely violate WTO rules, but I suspect China will care about violating WTO rules as much as Trump does".

US President Donald Trump said late on Monday he had directed US Trade Representative Robert Lighthizer to target $ 200 billion worth of Chinese imports for a 10 per cent levy, citing China's "unacceptable" move to raise its own tariffs.

The United States has already announced a 25% tariff on $50 billion of Chinese goods, most of which will take effect as early as July 6, to punish China for stealing American trade secrets. China retaliated by raising import duties on $34 billion worth of American goods, including soybeans, electric cars and whiskey.

The Canadian government believes a deal to update NAFTA is still possible despite a USA move to impose tariffs on Canadian and Mexican steel and aluminum, Foreign Minister Chrystia Freeland said in Ottawa on Tuesday.

Pompeo said he raised the issue with Chinese President Xi Jinping.

"He's upping the ante", Wendy Cutler, a former US trade negotiator who is now at the Asia Society Policy Institute, said of Trump.

Updated: This article has been updated to add Trump's threat to possibly follow the new round of tariffs on $200 billion of goods with another round. The dollar-for-dollar retaliations are on imports of steel, aluminum, and other products from the Unites States, including a wide-spanning list of goods such as coffee, chocolate, condiments, toiletries, beer kegs, whiskies, various household items, and motorboats.

Lee said Trump's hardline approach is an attempt to undercut a shift in global power to China. "Trump could put more pressure on other countries like Japan and North Atlantic Treaty Organisation courtiers", said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management in Tokyo.

The government said it was responding in "equal scale" to Trump's tariff hike on Chinese goods in a conflict over Beijing's trade surplus and technology policy that companies worry could quickly escalate and chill global economic growth.

The NASDAQ index, which recently hit an all-time high, is under pressure now that some of the computer chip makers are showing their concerns over the possible trade war.

For some companies, the exposure to China is far higher: US tech giant Qualcomm generates 63 percent of its revenue in China and needs Chinese authorities to approve its takeover of semiconductor maker NXP.

There are few companies with more to lose than Apple in a trade war between the United States and China.

USA stocks are mostly higher Wednesday as technology and media companies lead a recovery from the turbulent trading seen the day before.

"We use American power, economic might and influence as a tool of economic policy", he said.

On April 3, the White House released a list of 1,300 Chinese products worth $50 billion that could be hit with potential tariffs.

Trump is now threatening a 10 percent tariff on another $200 billion in goods.

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