China places tariffs on another $16B worth of USA goods

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The trade war between the world's two largest economies rolled into a second round.

China said it will begin imposing 25 per cent duties on an additional US$16 billion of American goods immediately after USA levies take effect, making good on its pledge to retaliate in kind.

"This is a very unreasonable practice", the commerce ministry said on its website www.mofcom.gov.cn, responding to the United States' decision to slap 25 percent tariffs on another $16 billion of Chinese goods on Aug 23.

China's exports surged more than expected in July despite USA duties and its closely watched surplus with the United States remained near record highs, as the world's two major economic powers ramp up a bitter dispute that some fear could derail global growth. Chinese imports of USA crude oil in May, for example, averaged 427,000 bpd, more than any other destination and surpassing Canada's 289,000 bpd imports, EIA data shows.

The Chinese counter-move will take effect immediately after the United States imposes tariffs on the same amount of Chinese goods.

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In a statement on its official website late on Wednesday, China's commerce ministry criticized the USA move as being "unreasonable", saying it had no choice but to adopt the same measure on an equal amount of American goods ranging from fuel and steel products to autos and medical equipment.

The tariffs are aimed at industrial, rather than consumer, imports.

China has now either imposed or proposed tariffs on $110 billion of US goods, representing the vast majority of China's annual imports of American products.

China has already retaliated with duties of its own, and has pledged to match the USA dollar for dollar with new tariffs.

"With each successive round of tariffs, Trump continues to back China into a corner, forcing Beijing to respond in kind", said James Zimmerman, a partner in the Beijing office of worldwide law firm Perkins Coie and a former chairman of the American Chamber of Commerce in China.

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An earlier round of tariffs that went into effect on July 6 applied to $34 billion in imports. And Chinese regulators last month barred Qualcomm, a USA telecom leader, from completing its $44 billion acquisition of Netherlands-based NXP, which would have made it a more formidable competitor for Chinese companies.

US President Donald Trump started announcing new tariffs on imports in January as part of an attempt to negotiate what he called "fair, bilateral trade deals that bring jobs and industry back onto American shores".

The new list covers products such as semiconductors, electronics, plastics, and railway equipment.

Due to the rising trade tension between China and the United States, the trading arm of Chinese state oil major Sinopec is said to have suspended imports of crude oil from the United States. That's 24% of all Washington exports according to the Washington Department of Agriculture.

China deprives USA companies of the ability to set market-based terms in licensing and other technology-related negotiations.

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