China will raise tariffs on $60 bn worth US goods from June 1 in retaliation to the US tariff hikes and US plans to target almost all Chinese imports, China’s Foreign Ministry announced on May 13. This followed the latest round of US-China trade talks that ended on May 10 without a deal and Washington raising tariffs on $200 bn worth Chinese goods.
The new rates will target a number of US imports with tariffs ranging from 5 per cent to 25 per cent, according to a statement by the Tariff Policy Commission of the State Council-China’s Cabinet. The Chinese response came soon after President Donald Trump warned Beijing not to retaliate. “China should not retaliate-will only get worse!” Trump had tweeted.
President Trump had also ordered initiating a process to impose new duties on another $300 bn worth Chinese imports. “China will never surrender to external pressure,” Chinese Foreign Ministry Spokesman Geng Shuang said. In addition to tariff hikes, China may also use other measures to hit back as it imports fewer US products that restricts its ability to match tariffs dollar for dollar, Chinese experts feel.
Both sides have indicated that negotiations will continue, with Beijing’s top trade negotiator Liu He saying recently that the talks would take place in Beijing at an unspecified date. White House Economic Adviser Larry Kudlow said President Trump and Chinese Counterpart Xi Jinping could meet next month on the sidelines of the G20 summit to iron out their differences on trade, although no new talks are scheduled.