A survey by the American Chamber of Commerce in Shanghai found that most US businesses operating in China oppose the use of tariffs in retaliation for the challenges they face, from an uneven playing field to poor protection of intellectual property rights.
Farmer Terry Davidson walks through his soy fields July 6, 2018, in Harvard, Illinois, the same day China imposed retaliatory tariffs aimed at the United States soybean market.
China could also limit visits to the United States by Chinese tourists, a business state media said is worth $115 billion, or shed some of its U.S. Treasury holdings, Iris Pang, Greater China economist at ING in Hong Kong, wrote in a note.
Reuters noted that significantly less than $200 billion of usa goods are exported to China, which means the country could have to turn to creative measures in order to retaliate.
The abrupt escalation is "totally unacceptable", said a Commerce Ministry statement.
The US said that was in response to Beijing's failure to change its policies and to retaliate for last week's US tariff hike by increasing its own duties on American goods.
"As a result of China's retaliation and failure to change its practices, the President has ordered USTR to begin the process of imposing tariffs of 10 percent on an additional $200 billion of Chinese imports", U.S. Trade Representative Robert Lighthizer said.
The Trump administration said the proposed list, which would put 10 percent tariffs on thousands of different categories of Chinese imports, is needed to increase the pressure on Beijing to change what the USA calls unfair trade practices. The move came just four days after the two countries imposed tit-for-tat tariffs of $34 billion on each other's products. While this initial move focused more on Chinese industrial products, the follow-up promises to instead affect ordinary consumers.
While Chinese shares regained Wednesday's heavy losses, with the Shanghai Composite index rising 2.2 percent, the yuan fell against the dollar following the central bank's weakest daily fixing in almost a year and Washington's fresh tariff threats.
The U.S. Chamber of Commerce has supported Trump's domestic tax cuts and efforts to reduce regulation of businesses, but does not back Trump's aggressive tariff policies.
"The United States has unveiled the list of tariffs in an escalating manner".
The tariffs will not be imposed until after a two-month period of public comment on the proposed list, but some USA business groups and senior lawmakers were quick to criticize the move.
Senate Finance Committee Chairman Orrin Hatch said the announcement "appears reckless and is not a targeted approach". "Tariffs threaten to boomerang on the very workers they're supposed to help, and will only further undermine the confidence manufacturers need to make investments in new equipment, facilities and people".
The survey showed 53 percent of companies increased investment in 2017, down from 55 percent the year before, highlighting a trend of reduced investment growth since a 2012 peak, when 74 percent of respondents said they had boosted investment in China.
"Tariffs are taxes, plain and simple".
"Unfortunately, China has not changed its behavior - behavior that puts the future of the US economy at risk", he continues.
The Office of the US Trade Representative is seeking submissions on the latest proposed tariffs and will conduct hearings in late August, making September the earliest possible implementation date for the new import taxes.