China to hike tariffs on American products in retaliation
Beijing, Mar 23:China today said it will impose higher duties on USD 3 billion worth of US imports, including pork and steel pipes, in retaliation to stiff US tariffs on Chinese steel and aluminium imports, triggering fears of a trade war between the world’s two largest economies.
Trump had directed the US trade representative to level tariffs on about USD 50 billion worth of Chinese imports following a seven-month investigation into the intellectual property theft, which has been a longstanding point of contention in US-China trade relations.
“We have a tremendous intellectual property theft problem,” Trump said. “It’s going to make us a much stronger, much richer nation.”
Trump yesterday signed a memorandum announcing the trade actions, invoking Section 301 of the 1974 Trade Act, which formed the basis for the administration’s investigation.
Before signing the measure, Trump lamented the US’ multi-hundred billion dollar trade deficit with China and said the action would be “the first of many.”
Trump’s proposed tariffs are a response to allegations of intellectual property theft by China.
In August 2017, the US initiated an investigation into Chinese intellectual property and technology transfers under Section 301 of the Trade Act of 1974.
The US also launched a complaint against China at the World Trade Organisation (WTO) today.
Its statement said: “China appears to be breaking WTO rules by denying foreign patent holders, including US companies, basic patent rights to stop a Chinese entity from using the technology after a licensing contract ends.”
“China also appears to be breaking WTO rules by imposing mandatory adverse contract terms that discriminate against and are less favourable for imported foreign technology,” the statement added.
Reacting to the US move, Beijing said it firmly opposed the planned tariffs but China’s ministry of commerce said it was “confident and capable of meeting any challenge”.
“China will not sit idly by its own legitimate rights and interests. We are fully prepared to defend our legitimate interests,” the ministry said.
But it said it hoped the US would not drag bilateral economic and trade relations into danger.
China’s embassy in Washington indicated the country was up for a fight in a statement, which said “China’s not afraid of and will not recoil from a trade war.”
Beijing’s measures suspending tariff concessions will target 128 US products including pork, wines and seamless steel tubes, the Ministry of Commerce said.
According to the ministry, the measures will include a 15-per cent tariff on products including fruits, nuts, wines and seamless steel tubes, and a 25-per cent tariff on pork and recycled aluminium products.
The measures will be implemented in two stages.
In the first stage, the 15-per cent tariff will be imposed if the two countries could not reach an agreement on trade issues within scheduled time.
In the second stage, the 25-per cent import tax will be imposed after evaluating the impact caused by the US policies, state-run Xinhua news agency quoted the ministry as saying.
The move was aimed at countering US decision to impose 25 per cent tariffs on steel imports and 10 per cent on aluminium, with initial exemptions for Canada and Mexico.
In August 2017, the US initiated an investigation into Chinese intellectual property and technology transfers under Section 301 of the Trade Act of 1974.
The move, which comes on the heels of the administration’s steel and aluminum tariffs that also took aim at China, is heightening concerns of a global trade war that could destabilise the global economy — fears the Trump administration has repeatedly brushed off.
