China imposes equal tariffs on U.S. imports in retaliation

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The move will escalate the trade dispute between the world's two largest economies and deepen the trade war between the USA and a host of others, including the European Union.

President Trump's war on free trade continues as the United States will implement a 25 percent tariff on $50 billion worth of goods from China that contain "industrially significant technologies".

Trump's revised tariff list might exclude some consumer items from an earlier proposal to focus more on goods related to Beijing's "Made in China 2025" program, Eurasia Group said in a report.

He said: "China is our real trade enemy, and their theft of intellectual property and their refusal to let our companies compete fairly threatens millions of future American jobs".

Fiona Cincotta, Senior Market Analyst at City Index says that the new tariffs show that President Trump is looking to take its trade argument with China to "another level".

China's Ministry of Commerce had promised swift retaliation after Trump announced the tariffs on Friday morning.

"We will immediately launch tariff measures that will match the scale and intensity of those launched by the United States".

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In April, the USA revealed an initial list targeting about 1,300 products worth US$50 billion in Chinese imports. The US imported $505 billion worth of goods from China past year and exported about $130 billion, leaving a 2017 deficit of $376 billion, according to government figures.

It said the tariffs would be applied in two stges: an initial slimmed-down list of 818 product lines worth $34 billion, followed by a second list of products that have largely benefited from industrial policies including the "Made in China 2025" technology development programme.

"My great friendship with President Xi [Jinping] of China and our country's relationship with China are both very important to me", said Trump.

"The Chinese side doesn't want to fight a trade war, but facing the shortsightedness of the USA side, China has to fight back strongly", the statement said.

The president has already threatened to annul the North American Free Trade Agreement after a year of inconclusive talks with Canada and Mexico, and ordered an investigation into whether the USA should impose tariffs on auto imports because he says they threaten American economic security.

China has threatened to retaliate forcefully for any tariffs, listing USA products that range from sorghum, soybeans, meat and whiskey to airplanes and cars.

Stocks closed in the red on Friday as the Trump administration moved to impose tariffs on China, Beijing fired back with and a looming OPEC meeting weighed on the energy sector.

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In a statement, he warned of "additional tariffs" should China hit back with tit-for-tat duties on American goods and services exports. It won't target the 284 additions, worth $16 billion, until after it collects public feedback.

The president has been under pressure from US lawmakers over his decision to soften a penalty on Chinese telecom-equipment maker ZTE Corp.

The Trump administration had prepared a refined list of Chinese products to be hit with tariffs that hones in on technologies where China wants to establish itself as a leader, according to five different people familiar with the matter.

"Our take is that a trade war would bring four negatives - somewhat higher inflation; growing anxiety in the US farm belt; uncertainty that could complicate long-term corporate planning; and a growing estrangement of the USA on the global stage".

Trump, in his press conference in Singapore on Tuesday, said the USA has a 'tremendous deficit in trade with China and we have to do something about it'.

"In today's era, launching a trade war is not in the global interest", China's Commerce Ministry said.

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