U.S. escalates trade war with new $200 billion China tariff list

Chairman Xi speaks at the National People’s Congress in Beijing

Chairman Xi speaks at the National People’s Congress in Beijing

The additional 6,031 product lines would be hit with a 10 percent tariff.

The move, which was expected, escalates a trade war with China.

"The Trump administration is gambling that by wielding such a big club, it will force China to back down", said Edward Alden, a senior fellow at the Council on Foreign Relations.

The consultation process for the new list will probably last about two months, including public hearings to take place from August 20 to 23, two senior administration officials said Tuesday on a conference call with reporters.

Companies are "scrambling to readjust supply chains" so US -bound goods don't pass through China, Harborn said at a news conference.

Also Tuesday, China stepped up action against some US goods by announcing anti-dumping duties raw materials used in making optical fibers.

US Trade Representative Robert Lighthizer said Washington did a thorough investigation to justify imposing tariffs on $50 billion worth of imports to compensate for the harm to the US economy caused by China's unfair trading practices, including theft or forced transfer of American technology.

US Senate Finance Committe chairman Orrin Hatch labelled the move as "reckless", while the US retail industry leaders assocation immediately condemned the move, saying the "the President has broken his promise".

Chinese officials also encouraged businesses to reduce their reliance on US goods, urging them to shift orders for products such as soybeans and automobiles to suppliers in China or countries other than the United States.

Last Friday, the United States imposed 25 percent tariffs on $34 billion in Chinese products, and Beijing responded by hitting the same amount of USA imports.

To argue their case against tariffs, consumer companies' playbook has included pointing to higher costs for everyday goods, while laying the blame at the president's feet - the American Apparel and Footwear Association has dubbed the tariffs the "Trump tax". The official added that China has warned the US that future actions would be met with "economic attacks" on American markets.

The Trump administration said it cracked down on China for a range of trade practices involving intellectual property and technology that cost USA companies an estimated $50 billion annually. "It will also result in retaliatory tariffs, further hurting American workers", a Chamber spokeswoman said. Since then, the president has said his administration could impose duties on virtually all Chinese imports into the U.S.

Trade war with the world: United States tariffs on aluminum and steel from Canada, the European Union and other countries have also triggered retaliatory tariffs on USA goods.

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