In Video: Trade war looms after Beijing retaliates against U.S. with tariffs
US and China Edge Closer to Trade War as Beijing Announces Retaliatory Tariffs
The United States and China appear to be inching closer to a trade war after Beijing revealed it would be retaliating against Washington’s tariffs with its own on US goods. The move comes just minutes after the US’s 10% tariff on Chinese imports came into effect at midnight.
China’s Retaliatory Measures
Beijing announced that it would impose tariffs of 15% on US coal and liquefied natural gas, as well as 10% on other US imports such as crude oil and agricultural machinery. These tariffs are set to take effect on February 10th.
US Tariffs on Canada and Mexico Put on Hold
Despite the looming trade war with China, the US tariffs on Canada and Mexico appear to be on hold for now. Following phone calls with Canada’s Prime Minister and Mexico’s President, President Trump announced that he would pause tariffs for 30 days, citing Canada’s plans to ramp up border security and Mexico’s agreement to beef up security at the southern border.
China’s Antitrust Probe and Unreliable Entity List
In addition to the retaliatory tariffs, China also announced an antitrust probe into Google and added certain US companies to its unreliable entity list. The companies added to the list include PVH Group, which owns clothing brands like Calvin Klein and Tommy Hilfiger, and alumina, a gene sequencing startup.
Uncertainty Ahead
The uncertainty now is whether this is all part of negotiating tactics between the two huge economies or whether it’s the beginning of a deeper trade confrontation. President Trump has said that he plans to speak with China’s President Xi Jinping, but it’s unclear when or if that call will happen.
Next Steps for Canada and Mexico
The tariffs on Canada and Mexico are currently on hold for a month, with the US and its neighbors agreeing to work on border security and trade issues. The White House will continue to evaluate the situation and negotiate with Canada and Mexico in the coming weeks.
Experts Weigh In
Economists say that China’s retaliatory measures are more symbolic than significant, affecting roughly 30% of US exports to China. However, the move is designed to send a message from China that it could get a lot worse, particularly for red states.
Conclusion
The US and China appear to be on a collision course, with both sides looking for leverage in the trade dispute. The situation is uncertain, but one thing is clear: the world is watching as two of the world’s largest economies engage in a high-stakes game of trade brinksmanship.