China said on Wednesday that it will impose 25% tariffs on an additional US $16 billion worth of American good from Aug 23.
The measure is a response to US’s decision to levy 25% duties on US$16 billion worth of Chinese goods and a final tariff list targeting 279 import product lines announced on Tuesday, which has brought the amount of impacted Chinese imports to US$50 billion.
The US decision to impose 25 percent tariffs on the same value of Chinese goods is very unreasonable and China will have to retaliate to protect its rightful interests and the multilateral trading system, said China’s Ministry of Commerce in a statement.
In addition, the revised Chinese list released yesterday adds hundreds of new items which will be affected by the newly announced tariffs. The list covers items ranging from coal, medical instruments, waste products, to cars and buses.
The trade tension between the two countries is likely to escalate further, as the US is reviewing 10% tariffs on a further US$200 billion of Chinese goods that it might even raise to 25% after a comment period that will end on Sep 6.
The US-China trade war will reduce global output by 0.7% by 2020, while the Chinese economy is expected to shrink by 1.3% and the US 1%, according to a recent research note by Oxford Economics cited in a recent Bloomberg report.
China’s export growth
While the trade standoff is intensifying, China’s exports grew 12.2% year-on-year in July, speedier than expected and up from a 11.2% gain in June.
The percentage also beat the Reuters poll of 10%.
The country’s trade surplus with the US dropped only slightly to US$28.09 billion last month $28.97 billion in June.