China Imposes New Tariffs on US, Accuses Washington of 'Trade Bullyism'

The United States and China are set to impose new tit-for-tat tariffs against each other's goods on Monday, the latest escalation in a heated trade war between the world's two largest economies.

The Trump administration has "has brazenly preached unilateralism, protectionism and economic hegemony, making false accusations against many countries and regions, particularly China, intimidating other countries through economic measures such as imposing tariffs, and attempting to impose its own interests on China through extreme pressure", the official Xinhua News Agency said.

Spot gold has fallen over 12 percent since April, which is when the trade conflict between two biggest economies of the world intensified.

But in a policy statement issued just hours after the dual tariffs took effect, Beijing accused Washington of using tariffs as a means of intimidating other countries to submit to US wishes on economic matters.

Treasury Secretary Steven Mnuchin had been expected to oversee the talks, which were called in hopes of easing tensions between the world's two largest economies, United States officials have said.

Monday's tariff hike follows a report by The Wall Street Journal that Chinese officials pulled out of a meeting to discuss possible talks proposed by Washington.

The US administration will levy tariffs of 10 percent on the $200 billion of Chinese products, with the tariffs to go up to 25 percent by the end of 2018.

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Neither side has backed down since the tit-for-tat tariff war began in July when the U.S. imposed duties on US$34 billion of Chinese goods.

Citing the white paper, state news agency Xinhua said that since taking office in 2017, Mr Trump's administration has "abandoned fundamental norms of mutual respect and equal consultation that guide global relations".

China summoned the United States ambassador in Beijing and postponed joint military talks in protest against a U.S. decision to sanction a Chinese military agency and its director for buying Russian fighter jets and a surface-to-air missile system. Earlier, he threatened Beijing with further tariffs on around $267 billion of imports if Beijing retaliates against the latest measure.

Rob Carnell, ING's chief Asia economist, said in a note to clients that in the absence of any incentives Beijing would likely hold off on any further negotiations for now. "We remain open to continuing discussions with China, but China must meaningfully engage on the unfair trading practices".

On the contrary, Bank of America Merrill Lynch has forecasted that the trade war will damage the United States economy, resulting in the bullion to reach an average valuation of $1,350 an ounce (currently at $1,198.36 an ounce) in 2019.

Trump earlier this month accused China of targeting rural voters who support his presidency by hitting agricultural goods. China's customs agency said it responded at noon by beginning to collect taxes of 5 or 10 per cent on a $60 billion list of 5,207 American goods, from honey to industrial chemicals.

Analysts said the news reflects the breakdown in the worldwide relationship.

  • Darren Santiago