Nation & World

U.S.-China trade war escalates again in tariff battle

Ag products face even higher retaliatory duties, China says

Containers of goods are stacked Aug. 6 at the Yangshan Deep Water Port in Shanghai, China. (Aly Song/Reuters)
Containers of goods are stacked Aug. 6 at the Yangshan Deep Water Port in Shanghai, China. (Aly Song/Reuters)

WASHINGTON — The trade war between the United States and China escalated again Friday as the two nations sought to outdo each other with retaliatory tariffs and President Donald Trump told American companies they were “hereby ordered” to find alternatives to sourcing their business in China.

Announcing his policy on Twitter, Trump lashed back at a new round of Chinese tariffs by placing an additional 5 percent duty on some $550 billion in targeted Chinese goods. The move came just hours after China unveiled retaliatory tariffs of its own against the United States, on $75 billion worth of U.S. goods.

The intensifying trade war stoked market fears that the global economy will tip into recession, sending U.S. stocks into a tailspin with the Nasdaq Composite down 3 percent and the S & P 500 down 2.6 percent.

Crude oil, targeted for the first time by Chinese tariffs, fell sharply.

Trump’s tariff response was announced after the markets closed Friday, leaving potentially more Wall Street damage for next week.

“Sadly, past Administrations have allowed China to get so far ahead of Fair and Balanced Trade that it has become a great burden to the American Taxpayer,” Trump wrote. “As President, I can no longer allow this to happen!”

He said the United States would raise its existing tariffs on $250 billion worth of Chinese imports to 30 percent from the current 25 percent beginning Oct. 1.

At the same time, he announced an increase in planned tariffs on the remaining $300 billion worth of Chinese goods to 15 percent from 10 percent. The United States will begin imposing those tariffs on some products starting Sept. 1, but tariffs on about half of those goods have been delayed until Dec. 15 — giving retailers some time to stock up for the holiday shopping season.

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The U.S. Trade Representative’s office confirmed the effective dates, but said it would conduct a public comment period before imposing the rate on Oct. 1.

Trump has accused China of unfair trade practices and pushed for a deal that would rebalance the relationship in favor of U.S. manufacturers and workers.

“We don’t need China and, frankly, would be far better off without them. The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP,” Trump tweeted earlier Friday.

“Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.”

It’s unclear what legal authority Trump would be able to use to compel U.S. companies to close operations in China or stop sourcing products from the country.

Trump also said he was ordering shippers including FedEx. Amazon.com, UPS and the U.S. Postal Service to search out and refuse deliveries of the opioid fentanyl to the United States.

Business groups reacted angrily to Trump’s latest tariff escalation.

“It’s impossible for businesses to plan for the future in this type of environment. The administration’s approach clearly isn’t working, and the answer isn’t more taxes on American businesses and consumers. Where does this end?” asked David French, a senior vice president for the National Retail Federation.

The U.S. Chamber of Commerce rebuffed Trump’s call, urging “continued, constructive engagement.”

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“Time is of the essence. We do not want to see a further deterioration of U.S.-China relations,” Myron Brilliant, executive vice president and head of the business group’s international affairs, said in a statement.

China’s Commerce Ministry said that on Sept. 1 and Dec. 15 it will impose additional tariffs of 5 or 10 percent on a total of 5,078 products originating from the United States — including agricultural products like soybeans, beef and pork. Beijing also is reinstituting tariffs on cars and auto parts originating from the United States that it suspended last December as U.S.-China trade talks accelerated.

“China’s decision to implement additional tariffs was forced by the U.S.’s unilateralism and protectionism,” the Commerce Ministry said in a statement.

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