China to impose additional tariffs on $16B worth of USA goods

The White House reportedly had a private meeting with tech industry representatives last week.                  Daniel Terdiman  CNET

The White House reportedly had a private meeting with tech industry representatives last week. Daniel Terdiman CNET

This round of tariffs is the second to be imposed under the Trump administration, following an earlier round in which $34 billion of Chinese imports saw altered charges starting July 6th.

The U.S. action that prompted the Chinese retaliation was the latest by President Donald Trump to put pressure on China to negotiate trade concessions, after Washington imposed tariffs on $34 billion in goods last month.

The 25 percent tariffs also will apply to a broad range of Chinese electronics, plastics, chemicals and railway equipment that the Office of the U.S. Trade Representative (USTR) has said benefit from the "Made in China 2025" industrial plan, aimed at making China competitive in high-technology industries. The step brought the total worth of Chinese goods facing a 25 percent tariff to $50 billion.

So far, China has now either imposed or proposed tariffs on $110 billion of US goods, representing the vast majority of its annual imports of American products.

President Donald Trump has suggested he may tax effectively all imports of Chinese goods, which reached more than $500 billion previous year.

For its part, China has threatened to ratchet up the tit-for-tat trade war by slapping tariffs on another $60bn of American imports.

The world's two biggest economies are locked in a trade dispute.

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"My expectation is that U.S. tariffs on $250 billion of imports from China will be in effect about a month prior to the November U.S. elections".

"Looking ahead, we expect export growth to cool in the coming months, though this will primarily reflect softer global growth rather than United States tariffs, the direct impact of which will continue to be mostly offset by the renminbi's (yuan's) recent depreciation", Capital Economics' Senior China Economist Julian Evans-Pritchard wrote in a note.

After a strong start to the year, growth in the world's second-largest economy cooled slightly in the second quarter, partly hit by the government's years-long efforts to tackle debt risks.

China has, in recent years, become a key export market for growing USA energy exports.

All China's main state newspapers published a lengthy commentary by the official Xinhua news agency, entitled "declaration", on their front pages.

The US is also considering further tariffs on another $200bn worth of Chinese goods which could come into effect in September. Beijing is expected to hit $16 billion worth of United States goods with equal tariffs in response to Tuesday's move.

China's prohibitive import tariff, which amounts to close to $18 a barrel when crude is at $70, should also deter other Chinese buyers such as state-owned companies Petro China, as well as state-controlled Zhenhua Oil and independent refiners, from importing USA crude.

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