China threatening tariffs on $60 billion worth of US goods

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The result could weigh on revised calculations of second quarter growth, which President Donald Trump hailed as a key The US bilateral trade deficits also expanded with China, the European Union, Canada and Mexico achievement of his economic policies last week after it was reported as the strongest GDP increase in almost four years.

On June 18th, President Trump directed U.S. Trade Representative Robert Lighthizer to identify another $200 billion worth of Chinese goods for additional tariffs at a 10 percent rate. "For instance, those U.S. products that become gradually indispensable for Chinese firms and consumers would be subject to additional levies of 5 percent".

While Mr Trump has taken credit for new steel jobs created with the help of tariffs, retaliatory measures by Beijing and others have rattled United States soya bean farmers and the many companies reliant on increasingly expensive steel as a raw material.

In addition, more than 500 goods on the lists aren't traded at all, and China imported less than a million dollars worth of about another 2,000 items, according to a Bloomberg analysis of 2016 trade flows. China immediately vowed to retaliate though at the same time urged the USA to act rationally and return to talks to resolve the row.

The expanding trade conflict is showing its first signs on the Chinese economy, which has already been slowing down this year.

Workers at a swimwear factory in Yinglin town in Jinjiang, in China's eastern Fujian Province. Another $16 billion in levies will likely follow in the coming days or weeks. One of the biggest targets of the China tariffs has been farmers; Beijing is the biggest buyer of USA soybeans, importing more than $12.4 billion worth of the oil seed in 2017, according to the Peterson Institute for International Economics. The Chinese side seem to be seeking to match that ratio with the new proposals. The government announced it has prepared a list of $60 billion worth of US goods to hit with duties should the USA follow through on a plan to impose duties on an additional $200 billion of Chinese goods, as early as next month.

Concerns about the trade war have already affected China's currency, which has fallen nearly 9% against the dollar since April.

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The Chinese government calls its response 'rational'. The divergence between United States agriculture's collective struggle to retain healthy profits without access to the Chinese market and Huawei beating all of its American competitors to become the second most popular smartphone brand in the world just after South Korea's Samsung, is indicative of the fact that many of China's flagship brands cannot only survive but thrive even when being cut off from the U.S. market.

Another reason China is anxious is because Washington's actions have come when the domestic Chinese economy is going through a bad time.

"Really what we're looking to see is whatever actions are taken do not have the staying, negative fallout as the tariffs did in 2002", Paglia said, referring to tariffs President George W. Bush placed on imported steel. On Friday, officials stepped in to cushion the yuan, which has been battered by trade tensions and was approaching the key level of seven to the dollar.

Trump cited losses in China's stock market as he predicted the USA market could "go up dramatically" once trade deals were renegotiated. "Likewise other countries. We are Winning, but must be strong!"

Answering a reporter's question about what was specifically said on trade, Wang said: "We did not speak in such details".

The American Petroleum Institute, a trade association whose members include Exxon Mobil Corp, Chevron Corp and ConocoPhillips, said the new Chinese tariffs would hurt American workers.