Published: Wed, August 08, 2018
Business | By Eloise Houston

China Prepared for Long Trade War With U.S., State Media Says

China Prepared for Long Trade War With U.S., State Media Says

In thinking that China will be "broken" by USA tariffs, Donald Trump's nation is rapidly learning that a mutually disadvantageous trade war is far more disadvantageous to U.S. businesses than to Chinese industries.

Beijing has announced plans to slap import taxes targeting 5,207 American products worth $60 billion in retaliation to trade tariffs on Chinese goods imposed by the US.

The world's two biggest economies further escalated trade tensions last week, with China announcing possible additional tariffs late Friday in response to United States moves.

The trade deficit with China rose by nearly 1% to $33.5bn. Washington is expected to soon implement tariffs on an additional $16 billion of Chinese goods, which China has already announced it will match immediately.

Trump, in a series of Twitter posts before an OH campaign rally, said he was using tariffs, and the threat of tariffs, to try to force other countries to renegotiate trade deals with the United States.

The minister added: "China has to take necessary countermeasures to defend its dignity and the interests of its people". While denouncing the US leader's actions, Beijing is also using its media to calm markets and express concern about the impact on the Chinese economy. China responded with a 178.6 percent tariff on the roughly $1 billion in sorghum that the US imports to China each year.

"Tariffs have had a tremendous positive impact on our Steel Industry", he said in one tweet.

According to the US Census Bureau, the US goods trade deficit with Canada jumped to just over $2 billion in June from $1.5 billion in May.

Trump on Saturday claimed his administration's enormous tariffs on other nations, including China, are "working far better than anybody anticipated", though economists have warned his trade policies could harm the global economy.

But based on the latest trade numbers, released Friday, it appears Trump is falling short of his main goal for trade battles; the United States trade deficit is actually heading in the opposite direction.

April 2: China imposed tariffs between 15 percent and 25 percent on 128 US products worth a total of $3 billion.

The state-run Global Times, responded to White House economic adviser Larry Kudlow's remarks that China should not underestimate Trump's resolve, saying that China was not afraid of "sacrificing short-term interests". Beijing retaliated by imposing similar charges on the same amount of US products. Plants are opening all over the U.S., Steelworkers are working again, and big dollars are flowing into our Treasury. China is expected to retaliate to the latest USA moves. I say, as they come, Tax them.

One of Mr Trump's top economic advisors said the U.S. leader has no intention of backing down.

Similar to crude oil and LNG, coal was another area where Trump could have made a difference to US exports to China. The deficit in goods trade with China also rose.

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