Steep American tariffs on Chinese goods worth tens of billions of dollars are due to take effect when the clock strikes twelve on Thursday night, as US President Donald Trump fires the first salvo in a trade war between the world’s top two economies.
China has vowed to respond “immediately”, with experts warning that tit-for-tat measures between the two financial superpowers will send shockwaves around the global economy and strike at the heart of the world trading system.
The US will levy a 25-percent tariff on more than 800 Chinese product categories worth around $34 billion and has warned of more to come if a trade war escalates.
Trump has threatened to progressively ratchet up US penalties to a total of $450 billion in goods which would represent the lion’s share of all of China’s exports to the United States.
The tariffs target a broad spectrum of Chinese goods such as passenger vehicles, radio transmitters, aircraft parts and computer hard drives from industries Washington says have benefited from unfair trade practises.
A second tranche of 284 goods worth $16 billion is currently under review and could be added to the US list.
US ‘firing at itself’
China is expected to retaliate as soon as the US tariffs go into effect, imposing duties on goods worth roughly the same amount but with a greater emphasis on politically sensitive farm agricultural products.
“The US has provoked this trade war. We do not want to fight it, but in order to safeguard the interests of the country and the people, we have no choice but to fight,” said Gao Feng, spokesman for China’s commerce ministry.