China warns of tariffs on imported United States goods worth $60bn

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Beijing threatened Friday to bring in the levies on products ranging from beef to condoms, after US President Donald Trump's administration upped the ante in its plans for additional tariffs on Chinese goods worth US$200 billion.

China's foreign minister said Saturday (Aug 4) that his country's threat to impose retaliatory tariffs on US$60 billion of American goods in an escalating trade spat was "fully justified".

During a July 20 CNBC interview, Trump said that he was willing to put tariffs on all $505.5 billion dollars worth of goods that China exports annually to the U.S. In negotiations with China, Trump's major request was a massive reduction in the bilateral trade deficit.

And Washington is expected to impose additional levies on $16 billion worth of Chinese goods that Beijing promised it would immediately match.

"The magnitude, we don't know yet", Kassis said.

The tariffs would be imposed at four different tax rates, China's Ministry of Commerce said in a statement.

US companies are putting in place measures to cushion the impact of the trade row, including price hikes, and a number of companies - from industrial firms to home furnishers and toymakers - have said they will move some sourcing and manufacturing outside of China.

The action could threaten the health of the USA economy, including the machinery and farming sectors of the Mahoning Valley economy, officials say.

The Commerce Department said on Friday the trade gap surged 7.3 per cent to $46.3 billion.

Trump's tariffs target goods the White House says benefit from industrial policies that China's trading partners say violate its market-opening pledges.

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China's new threat targeting a smaller amount of us goods reflects the fact that Beijing is running out of products for retaliation due to its lopsided trade balance with the United States.

China has said it will levy new tariffs on more than 5,200 United States products, if the White House moves forward with its latest tariff threat.

The U.S. hit back with tariffs on 1,300 Chinese goods worth $50 billion.

The trade war between the world's two biggest economies is taking on a life of its own.

Hopes had been rising that Trump might drop his trade-war campaign after the president announced a deal last week with European Commission President Jean-Claude Juncker that would see the U.S. and EU cut tariffs and other barriers.

Speaking to Bloomberg TV yesterday, National Economic Council Director Larry Kudlow said: "We've said many times: no tariffs, no tariff barriers, no subsidies".

The Bank of England said on Thursday protectionist trade policies were beginning to have an adverse impact, most notably on indicators of global goods trade.

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

Beijing said the timing of the new tariffs would depend on whether the United States follows through on its threat.

"The U.S.is in a better position to ride through the tariff concerns because of a strong economy", said Sung Won Sohn, chief economist at SS Economics in Los Angeles.

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