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US-China trade war sharply escalates; Trump imposes tariffs on $550 bn worth of Chinese imports

Washington/Beijing: The US-China trade war that began a year ago, dramatically escalated with US President Donald Trump’s announcement of imposing tariffs on $550 billion worth of Chinese imports. The tariffs would come into effect in the next two months. On Friday, China declared the imposition of tariffs on $75 billion worth of the US imports. In retaliation, the US adopted a stiff stand and targeted the entire range of Chinese imports. With the US President’s announcement, the sun seems to have set, on the possibility of ending the trade war, between the two largest economies of the world.

On Friday, the Chinese State Council announced that it was slapping tariffs ranging from 5% to 10% on $75 billion US goods. China further clarified that the tariffs would be applicable from September as also that they were imposed in retaliation to the US President’s threats on the trade war. The tariffs were an immediate US reaction to the Chinese move.

President Trump announced imposing the fresh tariffs on social media while showering fiery criticism on China. ‘China is taking undue advantage of the United States in trade for the past several years. Over the years, the United States has lost hundreds of billions of dollars in trade with China. The previous administrations of Clinton, Bush and Obama, had taken no action on the matter. However, as the President of the United States, I cannot tolerate it anymore. China’s decision to impose tariffs on US goods worth $75 billion has a political motive,’ Trump warned as he imposed the retaliatory tariffs.

President Trump informed that the tariffs on Chinese goods would be imposed in two batches. The first would involve $300 billion worth of Chinese products being subjected to 15% tariffs from Sept 1, and $250 billion of their imports were to be subjected to 30% tariffs from Oct 1 in the second. It is evident from Trump’s announcement that the entire range of Chinese import would receive tariffs.

Talks have been ongoing between the United States and China to work on a solution for the trade war for the past few months. Nevertheless, Trump had warned of slapping additional tariffs, accusing China of using dilatory tactics. After that, China delivered a blow to the United States by devaluing its currency, Yuan. Subsequently, President Trump clearly mentioned that talks with China weren’t likely and that he would soon announce a new measure.

China’s announcement on the imposition of tariffs on the US imports before Trump could initiate any action appears to have led Trump to decide to impose tariffs on the entire range of Chinese imports in retaliation. Analysts fear the move may cause detrimental effects on the global economy. Albeit, President Trump had already stated in the past that he was more concerned about the US economy than the global economy.

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