The trade conflict being dealt by China and the United States continued to get worse following the announcement from Beijing that it will hit a total of USD$60 billion worth of US products with steep import tariff in retaliation for Washington's newest levy policy affecting USD$200 billion Chinese goods.
These tit-for-tat measures signal the escalation of the trade dispute between the two economic powerhouses which, according to a report from Reuters, has the clear potential to cause a major upset in the global economy.
China's recent move to get back on the North American country reportedly prompted US President Donald Trump to issue yet another tariff threat which could hit more Chinese products, The Wall Street Journal report added.
In a statement released by the Chinese finance ministry on its website, the government's decision to slap this bulk of US goods with higher taxes is in line with its campaign to end the unilateralism and trade protectionism instigated by the Trump admin.
As further detailed by the news publication, the Chinese tariff will apply on more than 5,000 US products which include high-demand commodities like liquefied natural gas (LNG), cocoa powder, and even vegetables, just to name a few.
This latest turn of events somehow dampened the hopes of many market watchers and financial analysts that the trade situation will improve thanks to the proposed bilateral talks between the two governments.
However, as pointed out by the Journal, the Xi Jinping administration is now having doubts with the plan to sit in the negotiation table across its Western counterpart. The talks, slated to take place later this month, have been foreseen as an opportunity to quell the economic tension shared by the two concerned parties.
As reported earlier on this site, China is now opting to ditch its retaliatory stance in the trade war. This move from Beijing to become more active rather than take the defensive position could further make things worse for both countries, analysts and experts pointed out.
Raising the Stakes
On Monday, the White House announced that Trump has finally given the go-signal for the new tariff to take effect on about $200 billion Chinese import products. The rates would start at 10 percent by next week, Sept. 24, and will continue to increase up to 25 percent by the end of this year.
Meanwhile, the latest Chinese tariffs will also come into force around the same date.
