China sets retaliatory tariffs on US$60 billion in U.S. goods

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It started on Monday, when the Trump administration announced new tariffs of 10% on $200 billion worth of Chinese goods that will go into effect on September 24 and climb to 25% by January 1.

But a fresh report published today by Bloomberg says that various high-tech items will be excluded from the final list of $200 billion worth of Chinese imports subject to the 10% tariff.

Once the new round of tariffs takes effect on September 24, punitive duties will be in place on $250 billion in goods the USA buys from China - its largest source of imports. It appealed for "pragmatic dialogue" to "jointly safeguard the principle of free trade and the multilateral trading system".

Including an initial $50 billion round of tariffs that went into effect over the summer, Trump has enacted or threatened to tax more than $500 billion worth of Chinese goods.

The US tariffs start at a rate of 10%, before rising to 25% at the end of the year.

"Tariffs have put the USA in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country - and yet cost increases have thus far been nearly unnoticeable", Trump said on Twitter.

The move is the administration's way of addressing the theft of American intellectual property and forced transfer of American technology.

Earlier yesterday Mr Trump claimed that the consequences of the global trade dispute have been "almost..."

Meanwhile, China could explore other ways to make life hard for the Trump administration, such as doing its best to buy as much oil from Iran as possible. With Tuesday's hike, it covers $136 billion worth of U.S. goods when they take effect.

The president had warned in a statement on Monday evening that such action would take the form of tariffs on the remaining US$267 billion of Chinese imports, further expanding the already unprecedented scope of the trade war.

United States wages trade war on China with new $200bn tariffs
The levying a ten percent tariff on these imports starting September 24 and continuing at that rate until the end of 2018. China had in August said it would retaliate with $US60 billion in tariffs on USA goods, but has since gone quiet on the threat.

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"Contrary to views in Washington, China can - and will - dig its heels in and we are not optimistic about the prospect for a resolution in the short term", said Zarit of the American Chamber of Commerce. And China has retaliated in kind, hitting American soybeans, among other goods, in a shot at the president's supporters in the USA farm belt.

The president early on Monday seemed to undermine any efforts for a negotiated solution, saying tariffs have bolstered the United States bargaining position, while cost increases to consumers have been negligible and warned of more levies.

While there are measures China can take to retaliate, it is limited by the imbalance between its exports to the United States and its imports from the U.S., which amount to only about $US130 billion a year. And in a victory for Apple Inc. and its American customers, the administration removed smart watches and some other consumer electronics products from the list of goods imported from China.

"We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly", Trump said in a statement. "If countries will not make fair deals with us, they will be 'Tariffed!'"

Trump also has complained about America's massive trade deficit - $336 billion a year ago - with China, its biggest trading partner. U.S. Treasury Secretary Steven Mnuchin last week invited top Chinese officials to discussions. But Trump quickly backed away from the truce.

The new list would spare fitness trackers from Fitbit, which had said in a comment letter to regulators that the tariffs would compromise its own investment in the United States.

American technology vendors such as Cisco have previously warned that the tariffs will force them to push up their prices, hitting IT buyers in the wallet. But he's raising the pain on ordinary Americans at the same time.

The third round contains 5,745 full or partial lines of the original 6,033 lines of goods facing tariffs first announced July 10.

Mr Trump has warned further retaliation from China will see the U.S. put duties on all USA imports from the Asian economy. The import taxes imposed on steel and aluminum have been pressure points.