Trump promotes a trade war with China and plans to raise tariffs International trade

Stocks in Asia plummet after signal that US will import tax hike to 25%, dealing blow to expect a lasting deal

Donald Trump has increased the trading war with China by announcing plans to raise the tariff imposed on $ 200bn of Chinese goods from 10% to 25% Friday.

In addition, US president threatened to impose tariffs on all Chinese trade with America, moving the relationship between the two economic powers could be further destabilized.

The move sparked a sharp fall in Asia Pacific stocks on Monday and the Chinese chip blue stock index fell 4% – the largest fall for two months – and the Seng Hang fell 2.5%.

Trump's comments were that the trade talks would come to light when Monday Times newspaper editor said the Chinese Vice-Principal, Liu, was “very likely” to the US this week.

“Let Trump raise tariffs. We see where trade talks can return again, ”Hu Xijin said in a tweet.

Trump announced the move on Twitter, complaining that the negotiations between the two countries were proceeding too slowly.

He put tweeted:

For 10 months, China pays 25% of Tariffs with the USA on 50 Billion High Technology Dollars, and 10% on 200 Billion Dollars other goods. These payments are partly responsible for our excellent economic results. The 10% will go up to 25% on Friday. 325 Billions of Dollars.

– Donald J. Trump (@realDonaldTrump) May 5, 2019

The move will affect over 5,000 products made by Chinese farms and factories, from fresh and frozen to chemicals, textiles, metallurgy, building materials, electronics and consumer goods.

Trump first paid these goods a 10% tariff last September in an effort to reduce American trade deficit with Chinese concessions and the force on issues such as intellectual property rights. He was to leak to 25% in January but the president continued back and talks continued between the two sides.

Tariffs are currently affecting almost half of China's sales to America and Trump is now targeting the other $ 325bn.


What is the Chinese-US trade war?

He warned: “325 Billions The tolls toll the extra goods that China has sent us to us without tax, but they will be without delay, at a rate of 25%. Tariffs paid to the United States have had little impact on the cost of the product, which is largely paid by China. The Trade Deal continues with China, but too late, as they try to negotiate. No! ”

Such a movement could cause further pain and disruption to the Chinese economy, and it is likely that it would trigger retaliatory action at Beijing.

Patrick Chovanec, key strategies at Silvercrest Asset Management, warned that Trump's move could disappoint investors and push markets down.

“The prospect of higher and wider tariffs was likely to be one factor driving markets down in the fourth quarter of 2018, but since then the markets have felt that there has been some dealings to avoid them,” Chovanec said.

But Reva Goujon, Vice President for Stratfor's global analysis, suggested that Trump's move could help negotiate the line.

#Trump impose a threat of 25% #tariffs The remaining Chinese goods may be a real sign of progress. US, #China they are approaching final discussions but had to strike a wall. China was expecting the Trump threat in the final stages, a compromise in rear pocket could be ready.

– Reva Goujon (@RevaGoujon) May 5, 2019

Economists have blamed the US-China trade war for delaying global growth in recent months.

US treasury secretary, Steven Mnuchin, and trade representative, Robert Lighthizer, held talks with Chinese Deputy Prime Minister Liu He in Beijing last week. Liu was expected back in Washington within days.

Despite Trump's claim that China pays these tariffs, they are paid by US companies when they carry goods. These firms can transfer the cost to their customers through high prices, absorbing the cost and lowering their profits, or trying to reduce the cost of the goods.

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