China on Wednesday slapped the United States with 25 percent tariffs on $16 billion worth of U.S. goods, a direct response to President Trump’s earlier decision to impose similar tariffs on $16 billion worth in Chinese goods.
The announcement comes less than 24 hours after the U.S. Trade Representative’s office released a finalized list of 279 Chinese products targeted by the tariffs, which includes a variety of electronics, plastics, chemicals, and railway equipment, according to Reuters. The targeted items were selected specifically to hamper China’s ability to compete in “high technology” industries.
China has targeted crude oil and cars in this latest round of retaliatory tariffs, according to CNBC.
Art Hogan, chief market strategist at B. Riley FBR, told the outlet the new charges were undeniably “tit-for-tat, exactly.”
“Our $16 billion comes at a scheduled time, which comes up on the 23rd. China said we see your $16 billion and we’ll match your $16 billion,” he said. “They’ll pretty much match what we do until they have no more levers to pull.”
The tariffs are the latest move in a high-risk match between the two nations. Just last week, China promised to meet any U.S. trade threats with equal aggression, threatening to strike back at what it called “blackmail.”
“China is fully prepared and will have to retaliate to defend the nation’s dignity and the interests of the people, defend free trade and the multilateral system, and defend the common interests of all countries,” China’s Ministry of Commerce stated.
Earlier in July, the Trump administration had announced it would impose 25 percent duties on $35 billion worth of Chinese imports, threatening to slap China with tariffs on up to $500 billion worth of imports if it continued to retaliate.
“We’re down a tremendous amount,” Trump said in an interview with CNBC, referring to the existing U.S. trade imbalance with China, which hit a record high in 2017. “I’m ready to go to 500. …I’m not doing this for politics, I’m doing this to do the right thing for our country.”
Census Bureau data shows the United States accepted more than $500 billion in Chinese imports in 2017, while exporting just under $130 billion to China.
Trump previously promised to eliminate the United States’ trade deficit on the campaign trail, with then-economic adviser and current Commerce Secretary Wilbur Ross, and current National Trade Council Director Peter Navarro, stating their plan would accomplish that feat by mid-way through Trump’s first term.
The ongoing back and forth has dealt a blow to American workers and businesses, an unintended consequence of Trump’s refusal to back down.
Already, U.S. farmers — some of the very people Trump promised to help — have complained that the tariffs are hurting their bottom line. “Soybeans are the top agriculture export for the United States, and China is the top market for purchasing those exports,” American Soybean Association President John Heisdorffer stated last month, after Chinese officials included soybeans on their retaliatory list of targeted products.
“The math is simple,” he said. “You tax soybean exports at 25-percent, and you have serious damage to U.S. farmers.”
The tariffs have also had a deleterious effect on the electronics industry, many of whose components were included on China’s list of imposed duties. Earlier this week, television manufacturer Element Electronics was forced to close its Winnsboro, South Carolina plant in response to the president’s trade war, eliminating 5,000 jobs and dealing a heavy blow to the region’s economy.
“When you think you’ve reached rock bottom, to get kicked in the gut like this, you didn’t think anything more could happen,” state Sen. Mike Fanning (D-Fairfield) told The State, adding that the county had lost around 200 jobs following a textile mill closure only one year earlier.
“Within 365 days, you just get rocked to your core,” he said.