China says it will hit back against Trump’s latest tariffs

Steel pipes to be exported are seen at a port in Lianyungang Jiangsu province China

Steel pipes to be exported are seen at a port in Lianyungang Jiangsu province China

"Most of our member companies are "in China, for China" - selling goods to Chinese companies and consumers, not to Americans - and thus ultimately boosting the USA economy", Jarrett said.

US President Donald Trump on Monday (Sept 17) defied warnings and escalated the trade confrontation with China, hitting the country with tariffs starting next week on another US$200 billion in imports and threatening to target even more if Beijing retaliates. It will increase to 25 percent on January 1 unless the two countries reach a deal on trade.

Earlier this year, the administration announced 25 percent tariffs on $50 billion in Chinese goods, prompting China to retaliate in kind.

Trump is due to make the announcement after the close of US stock markets, where major indices were already sinking sharply in anticipation of what could be a major escalation in the US-China trade conflict.

If Beijing retaliates against USA farmers and industry - as it has previously vowed - the United States will immediately pursue further tariffs on about $267 billion of Chinese imports, President Donald Trump said in a statement Monday evening, repeating a threat he made earlier this month.

"After a thorough study, the USTR concluded that China is engaged in numerous unfair policies and practices relating to United States technology and intellectual property - such as forcing United States companies to transfer technology to Chinese counterparts", Monday's statement read.

China's 'counterattack strategy needs to restrict exports to the United States as well as (imports of) USA goods, ' Lou was paraphrased as saying. And in a victory for Apple Inc. and its American customers, the administration removed smart watches and some other consumer electronics products from the list of goods imported from China.

China wants talks based on 'mutual trust, ' said a foreign ministry spokesman, Geng Shuang. "We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly".

He said "no-one benefits from trade disputes or a global trade war". The Office of the U.S. Trade Representative has charged that China is using predatory tactics to obtain foreign technology. US Treasury Secretary Steven Mnuchin last week invited top Chinese officials to a new round of talks, but thus far nothing has been scheduled.

The Trump administration has bypassed the WTO on its tariffs, however. But Trump quickly backed away from the truce. But, in doing so, they can't take actions that deliberately discriminate against other countries; actions that hurt American workers. The levies focused on industrial products, not on things Americans buy at the mall or via Amazon.

By expanding the list to $200 billion worth of Chinese imports, Trump risks spreading the pain to ordinary Americans. The price of washing machines in the U.S.

If he does go ahead with a further $267bn worth of tariffs, it would mean virtually all of China's United States exports would be subject to new duties.

"This is the sixth or seventh time we talked about this particular round of tariffs", said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. But many analysts say his combative actions seem unlikely to succeed.

Trump, in a statement announcing the new round of tariffs, warned that if China takes retaliatory action against USA farmers or industries, "we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports".

Still, many market players expect the US economy to ride out the impact for now.

"With a narrowing focus on the U.S. midterm elections (Nov 6) and USA politics - as well as fast-money investors holding substantial aggregate long USD positions - we think the market narrative over the next few months could well transition from "default to the dollar" to "ditch the dollar", says Viraj Patel, an FX strategist at ING Group. "Fortunately, the USA economy is humming, so we don't have to worry as much about what this will do to our economy".

In Asian markets, China's Shanghai Composite waved off the tariffs to finish 1.6 percent higher.

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. Some will likely move to other low-priced countries that aren't in the line of fire. Some will bring operations to the United States - one of Trump's goals. "Now the calculus is more complicated".

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