U.S. mends ties with allies, prepares for trade war with China

U.S. mends ties with allies, prepares for trade war with China

U.S. mends ties with allies, prepares for trade war with China

President Donald Trump asked the US Trade Representative to consider increasing the proposed tariffs to 25 percent from the planned 10 percent, USTR Robert Lighthizer said on Wednesday.

The U.S. imposed 25 percent tariffs on $34 billion of Chinese products earlier this month, with plans to add another $16 billion of imports on Tuesday.

But Trump's tariffs have drawn criticism at home in the United States for driving up costs for consumers and companies that rely on Chinese imports.

China vowed on Thursday to retaliate if the United States acted on a threat to raise tariffs on the Asian nation's exports, fueling fears in financial markets that the trade war between the world's two biggest economies would escalate.

Mickey Kantor, who was USA trade representative under President Bill Clinton, warned that a trade war with China will take a toll on a us healthy economy that from April through June registered the fastest growth since 2014.

This is down nearly 16 percent from the June peak, a period that coincides with the ramping up of tariffs by the United States, coupled with increasingly bellicose rhetoric.

The White House says the tariffs are a response to China's unfair trade policies, which Mr Trump blames for helping to create a huge trade deficit.

The answer was actually first given by Trump first, when in a candid CNBC interview the president said that he was not only watching the U.S. trade deficit with China, but also its currency, which had dropped "like a rock" recently, suggesting that trade war was morphing into currency war after he berated the Fed for hiking rates and pushing the dollar higher.

On July 10, Washington unveiled a list of another US$200 billion in Chinese goods, from areas as varied as electrical machinery, leather goods and seafood, that would be hit with 10 per cent import duties.

In addition to the tariffs now in place, the Trump administration has proposed an additional 10 percent tariff on an additional $200 billion worth of imports from China. - Office of the U.S. Trade Representative.

The Commerce Ministry said the objective of the USA tariffs is to restrict China's "peaceful development"-not, as the US says, to retaliate for China's unfair trade practices with the goal of narrowing the wide trade gap between the two countries". "Unilateral threats and pressure will only be counterproductive".

But China's Foreign Minister Wang Yi said United States efforts to pressure China would be in vain, urging its trade policymakers to "calm down".

It would represent a ramping up of pressure over Washington's trade standoff with Beijing.

While the tariffs would not be imposed until after a period of public comment ends on September 5, a senior administration official said that Trump "remains open to conversations", and that the administration is "in contact with our Chinese counterparts".

A foreign ministry spokesperson, Geng Shuang, said Beijing was ready for "dialogue and consultation" to defuse the escalating dispute.

Meanwhile, in corporate America, it appears that there is just one thing executives are talking about: tariffs.

Camuñez notes that the Trump administration has given mixed signals about how tough it's willing to be with China, and that has complicated efforts to resolve the conflict.

The move comes after talks to avoid an escalation of the trade conflict fizzled out in June and also follows hard on the heels of a 5% fall in the value of the Renmimbi relative to the US Dollar, which was a move that many in the market say had the People's Bank of China written all over.

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