On Monday, China responded to the duties on aluminum and steel U.S. President Donald Trump implemented by raising the import duties on U.S. fruit, pork and other products valued at more than $3 billion. The move comes as companies worry the escalating duties dispute could depress worldwide commerce.
China’s Finance Ministry announced that it was responding to a tariff hike by the U.S. on aluminum and steel. However, a bigger dispute looms over the approval by Trump on possible higher tariffs on close to $50 billion in goods from China in an argument of a different kind over technology policies.
The current dispute on tariffs is one part of the increased tensions between Beijing and Washington over the multibillion-dollar trade surplus of China with the U.S. and its policies related to industry development, technology and access to an economy that is state-dominated.
Forecasters have been saying that the immediate impact will be limited, but investors are worried that a global recover would be hit with a setback if this prompts other countries to increase their import duties. Those worries helped to temporarily depress the financial markets although some losses have been recovered by stocks.
Beijing is facing complaints from the U.S, the European Union as well as other trading partners that it’s hampering market access even though it has pledged free-trading and has flooded global markets with low-priced aluminum and steel. However, Japan, the EU and other global governments criticized the unilateral move of Trump as disruptive.
The U.S. buys very little aluminum and steel from China following tariff hikes earlier to offset what the White House call improper subsidies. Nevertheless, economists expected Beijing would respond to avoid appearing weak in a dispute that is so high-profile.
Beijing, effective Monday, raised tariffs on aluminum scraps, pork and other products by 25%, said its Finance Ministry. A tariff of 15% was imposed on almonds, apples and other goods.
The ministry said China advocates as well as supports a multilateral trading system, but the tariff increase by China is a proper measure to protect the interests of the country.
No official response to the new tariffs has been released by the White House or President Trump. The government of China announced earlier its imports of the goods affected total over $3 billion in 2017.
The most recent move by China targets areas of farming in the U.S., where many voted for Trump in the presidential election of 2016.