Beijing: China warned the United States on Friday that it was “not afraid of a trade war” as it threatened tariffs on $3 billion worth of US goods in retaliation over President Donald Trump’s moves against Chinese imports. Beijing unveiled a hit list of products that could face duties of up to 25 per cent, from fresh fruit to meat and wine, though it stopped short of pulling the trigger as it indicated its readiness to negotiate an agreement.
The latest trade action sent stocks diving as fears rise that the US, which accuses China of mass theft of intellectual property and other unfair practises, could provoke a damaging trade war. The Dow Jones Industrial Average plunged more than 700 points, while Tokyo closed 4.5 per cent lower and Hong Kong and Shanghai were both down more than three per cent. “China does not want to fight a trade war, but it is absolutely not afraid of a trade war,” the commerce ministry said.
Hours earlier, Trump signed an order that also could result in restrictions on Chinese investment in the US, saying it would be the “first of many” trade actions.
“We have a tremendous intellectual property theft situation going on,” Trump said as he signed the new trade order, which could include duties as high as 25 per cent. The action did not immediately impose any new tariffs, but within two weeks US Trade Representative Robert Lighthizer is due to publish a list of the products that could be hit with tariffs, which will be followed by a period of public comment.
As Trump has marched towards a confrontation, Beijing has repeatedly warned that trade wars benefit no one and that it would not stand by as Washington imposed new punitive measures.
US Commerce Secretary Wilbur Ross on Thursday suggested the new measures on intellectual property were in fact a way of bringing Beijing to the table, telling CNBC they were “the prelude to a set of negotiations.”
China’s commerce ministry warned that a 15 per cent tariff on 120 goods worth almost $1 billion — including fresh fruit, nuts and wine — would be imposed if the US fails to reach a “trade compensation agreement” within an unspecified timeframe.
In a second step, a 25 per cent tariff would be imposed on eight goods totalling nearly $2 billion, including meat and aluminium scrap, after “further evaluating the impact of the US measures on China,” the statement said. — AFP
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