China Avenges US $ 75 Billion in Customs Duty on Customs
China will levy 5% or 10% duty on US imports from 1 September, according to a statement issued by the Chinese Ministry of Finance. The tariffs would be 25% or 5% and come into force on 15 December. The new rates apply to 5,078 products, including soybeans, coffee, whiskey, seafood and crude oil.
Last week, China announced it would take countermeasures after the US announced it would introduce 10% tariffs on Chinese imports valued at $ 300 billion in categories of Chinese-made consumer goods by December. They should come into force in September.
China's announcement triggered an angry reaction from US President Donald Trump on Twitter. Trump said he would answer China this afternoon.
"We do not need China and honestly would be much better off without it," Trump wrote. He also "ordered" American companies "to seek an alternative to China immediately."
The US markets that used to fight for direction gave way to comments. The Dow lost up to 400 points or 1
.6% in the late morning.
The US Commercial Representative's Office did not immediately comment on China's announcement of tariffs.
This is an indication that the ongoing trade war is affecting the world's two largest economies. According to the Chinese Bureau of Statistics, industrial production in China – an important indicator of the country's economy – grew by only 4.8% in July compared to the previous year. This is the worst growth in this sector for 17 years.
The American factories are also shrinking for the first time in a decade, and on the bond market red lights are flashing where the yield curve has reversed. Such inversions, where the 10-year government bond yield falls below the 2-year government bond rate, are historical predictors of an impending recession.
The US Chamber of Commerce, representing the interests of more than 3 million companies, called on China and the United States to "return to the table" to discuss important issues for both sides, including intellectual property and market access.
"Today's Chinese retribution is unfortunate, but not unexpected, the fact is that no one wins a trade war, and the ongoing escalation between the US and China is putting a significant strain on the US economy, increasing costs, undermining investment, and simmering markets "says the statement.
– CNN Business & # 39; Matt Egan has contributed to this report