United States president Donald Trump escalated his trade war with Beijing, imposing 10% tariffs on about US$ 200 billion worth of imports in a move one senior Chinese regulator said “poisoned” the atmosphere for negotiations.
Trump also warned in a statement on Monday that if China takes retaliatory action against U.S. farmers or industries, “we will immediately pursue phase three, which is tariffs on approximately US$267 billion of additional imports.”
China is reviewing plans to send a delegation to Washington for fresh talks in light of the U.S. decision, the South China Morning Post reported on Tuesday, citing a government source in Beijing, raising the risk of a prolonged trade battle between the world’s largest economies that could hit global growth.
U.S. trade actions against China will not work as China has ample fiscal and monetary policy tools to cope with the impact, a senior securities market official said.
“President Trump is a hard-hitting businessman, and he tries to put pressure on China so he can get concessions from our negotiations. I think that kind of tactic is not going to work with China,” Fang Xinghai, vice chairman of China’s securities regulator, said at a conference in the port city of Tianjin.
Collection of tariffs on the long-anticipated list will start on Sept. 24 but the rate will increase to 25% by the end of 2018, allowing U.S. companies some time to adjust their supply chains to alternate countries.
So far, the United States has imposed tariffs on US$50 billion worth of Chinese products to pressure Beijing to make sweeping changes to its trade, technology transfer and high-tech industrial subsidy policies. China has retaliated in kind.
Vice Premier Liu He was set to convene a meeting in Beijing on Tuesday morning to discuss the government’s response, Bloomberg News reported, citing a person briefed on the matter.
China has vowed to retaliate against new U.S. tariffs, with state-run media arguing for an aggressive “counterattack.”