China said on Tuesday it has no choice but to retaliate against new U.S. trade tariffs, risking even stronger action from President Donald Trump in an escalation of the trade war between the world’s largest economies, Reuters reports.
Beijing’s statement came hours after Trump imposed 10 percent tariffs on about $200 billion worth of imports from China, and threatened duties on about $267 billion more if China hit back on the latest U.S. action.
“To protect its legitimate rights and interests and order in international free trade, China is left with no choice but to retaliate simultaneously,” the commerce ministry said in a brief statement, without specifying what action it would take.
“The United States insists on increasing tariffs, bringing new uncertainties to bilateral trade negotiations. China hopes the United States would recognize the negative consequences of its actions, and take convincing steps to correct its behavior in a timely manner.”
Trump had warned in a statement on Monday that if China takes retaliatory action against U.S. farmers or industries, “we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports.”
The latest U.S. duties spared smart watches from Apple and Fitbit and other consumer products such as baby car seats. But if the administration enacts the additional tariffs it would engulf all remaining U.S. imports from China and Apple products like the iPhone and its competitors would not likely be spared.
Last month, China unveiled a proposed list of tariffs on $60 billion of U.S. goods ranging from liquefied natural gas to certain types of aircraft - should Washington activate the tariffs on its $200 billion list.
China is reviewing plans to send a delegation to Washington for fresh talks in light of the U.S. decision, the South China Morning Post reported on Tuesday, citing a government source in Beijing.
U.S. trade actions against China will not work as China has ample fiscal and monetary policy tools to cope with the impact, a senior securities market official said.
“President Trump is a hard-hitting businessman, and he tries to put pressure on China so he can get concessions from our negotiations. I think that kind of tactic is not going to work with China,” Fang Xinghai, vice chairman of China’s securities regulator, said at a conference in the port city of Tianjin.
Collection of tariffs on the long-anticipated U.S. list will start on Sept. 24 but the rate will increase to 25 percent by the end of 2018, allowing U.S. companies some time to adjust their supply chains to alternate countries.
So far, the United States has imposed tariffs on $50 billion worth of Chinese products to pressure Beijing to make sweeping changes to its trade, technology transfer and high-tech industrial subsidy policies. China has retaliated in kind.