US-China New Reciprocal Trade Tariffs Take Effect
The United States and China intend to introduce reciprocal new tariffs on Monday, exacerbating the already tense trade relations between the two largest economies of the world. The US tariffs on Chinese goods worth $200 billion and Beijing's response tariffs on US products worth $60 billion will begin to operate today. Both countries have already exchanged tariffs for $50 billion.
The Trump administration will levy tariffs of 10% on the $200 billion of Chinese products, with the tariffs to go up to 25% by the end of 2018. Beijing set its new levies on $60 billion of US goods at 5 and 10% and warned it would respond to any rise in US tariffs on Chinese products accordingly.
China intends to cancel trade negotiations with the United States because of the latest round of tariffs. Hong Kong’s South China Morning Post reported that China canceled the planned visit by Vice-Premier Liu He to the US on trade. But Beijing also said it was willing to restart trade negotiations with the United States if the talks are "based on mutual respect and equality".
Economists warn that ongoing trade conflict between the world’s two largest economies will ultimately stop the growth of not only the US and China, but the entire global economy. Concerns over confrontation have already been adversely affected by financial markets.