U.S., China trade war heats up with new, mutual tariff hikes

BEIJING — The United States and China imposed more tariff hikes on billions of dollars of each other’s automobiles, factory machinery and other goods Thursday in an escalation of a battle over Beijing’s technology policy that companies worry will chill global economic growth. The 25 percent increases on $16 billion of good from both sides took effect as envoys from both sides held their first high-level talks in two months in Washington.

No details were released about the two-day meeting that started Wednesday, but President Trump told the Reuters news agency in an interview Monday that in an interview that he didn’t “anticipate much” from the negotiations.

The penalties, previously announced, apply to goods including automobiles and metal scrap from the United States and Chinese-made factory machinery and electronic components. They follow last month’s first round of tariff increases of the same size by both sides on $34 billion of each other’s imports.

The Chinese government criticized the U.S. increase as a violation of World Trade Organization rules and said it would file a legal challenge.

Beijing has rejected U.S. demands to scale back plans for state-led technology development that its trading partners say violate its market-opening commitments and that American officials worry might erode the United States’ industrial leadership.

With no settlement in sight, economists warn the conflict could spread and knock up to 0.5 percentage points off global economic growth through 2020.

President Trump said last month he’s ready to hit all goods imported from China with tariffs.

In an interview with the business channel CNBC, he said, “I’m willing to go to 500,” referring roughly to the $505.5 billion in goods imported last year from China.

“I’m not doing this for politics, I’m doing this to do the right thing for our country,” Trump said on CNBC. “We have been ripped off by China for a long time.”

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Categories: Government & Politics

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