Skip to main content

Trump targets another $200 billion — trade war update, day six

The U.S.-China trade war is getting ugly, fast.

Before day five of the confrontation even came to the end, Bloomberg broke the news (paywall) that American officials were drawing up lists of additional Chinese products totaling $200 billion to tax at a 10 percent rate, to be published “likely this week.”

NEW U.S. DEMANDS

That list was released only hours later by the U.S. Trade Representative — see the full 205-page PDF of it here — along with a firm statement by the office’s head, Robert Lighthizer, who promised more escalation until the U.S. could achieve “the elimination of China’s harmful industrial policies” and see “China opening its market to U.S. goods and services.”

“The new tariffs won’t take effect for at least two months,” and “hearings on the products are scheduled for Aug. 20-23,” the Wall Street Journal reports(paywall).“Chinese fish, petroleum, chemicals, handbags, textiles” are among the products to be taxed if this second large round of much broader tariffs is implemented, the New York Times notes (paywall).“Tonight’s announcement appears reckless and is not a targeted approach,” Orrin Hatch, the Republican senator from Utah, said in a statement cited by the Journal and the Times, highlighting the increased controversy that the new tariffs could bring.Not on the schedule, at least for now, are any negotiations to de-escalate the conflict, according to “officials in both nations,” the Journal says.China is highly unlikely to back down on its industrial policies, by which Lighthizer means the Made in China 2025 initiative.The U.S. wants unilateral market opening, rather than a negotiated settlement on trade in goods through, say, the World Trade Organization. Dennis Shea, the U.S. ambassador to the WTO, told that body that “the WTO currently does not offer all of the tools necessary to remedy this situation,” and urged, “The best solution is for China finally to take the initiative to fully and effectively embrace open, market-oriented policies,” according to Reuters.

CHINESE GOVERNMENT REACTIONS

Officials are branding China as a protector of free trade in the conflict:

“This is a fight between unilateralism and multilateralism, protectionism and free trade, and between hegemony and rules,” Ministry of Finance spokeswoman Hua Chunying said, the Washington Post reports.“They go low, we go high,” Li Chenggang, an assistant minister at China’s Ministry of Commerce, said at a forum in Beijing with the City of Chicago, employing a Democratic Party slogan popularized by former first lady Michelle Obama in 2016, according to Bloomberg (porous paywall).Beijing sees this as an “economic cold war,” a “source close to decision makers in Beijing” told the South China Morning Post, and is “trying to convince governments, organizations and companies — including U.S. firms — that it is a champion of free trade, and send a message that, in contrast to Trump’s ‘America first’ policy, China is ‘still open for business’ and wants to keep globalization on track.”“To defend the core interests of the nation and the fundamental interests of the people, the Chinese government will, as always, be forced to take necessary countermeasures,” a spokesperson for China's Ministry of Commerce said, according to Xinhua.

MARKET REACTIONS

Chinese domestic financial markets are nervous:

“On Wednesday, China’s stocks fell,with the benchmark Shanghai Composite Index losing 1.8 percent and the Hang Seng Index in Hong Kong down 1.3 percent. The offshore yuan weakened to test 6.7 against the U.S. dollar — a level that Beijing defended only a week ago,” the SCMP notes.To prevent Chinese markets from further tumbling, or from a boycott against U.S. goods from taking off and escalating the conflict further, government officials have instructed state media to downplay the conflict and “be careful not to link [criticism] to Trump and instead to aim it at the U.S. government,” Reuters reports.“The Dow Jones Industrial Average fell 219 points, or 0.88%, to 24,700, the S&P 500 slid 0.71 percent and the Nasdaq was down 0.55 percent,” reports TheStreet.com, while the Financial Times said (paywall), “U.S. futures slid” and “industrial stocks were back under fire again” after the new tariff announcements: “Boeing is down 1.2 percent, Caterpillar dropped 1.5 percent and Deere shed 2 percent.” CNBC reports that “Nvidia, Advanced Micro Devices and Broadcom were among those falling more than 1 percent in trading… on fears about the escalating trade war.”

OTHER TRADE WAR NOTES

Industrial espionage
Chinese firm denies involvement in alleged theft of Apple self-driving car tech by its new employee / SCMPEffect on China-Germany relations
U.S.-China trade row helped BASF land $10 billion Guangdong chemical coup: Sources / ReutersForeign ownership of auto plants
After Tesla deal, Shanghai to speed up cancellation of foreign ownership limits / ReutersZTE
ZTE executives meet with U.S. Commerce Department officials to work out final details of compliance deal / SCMP

—Lucas Niewenhuis

Comments

Popular posts from this blog

Balochistan to establish first medical university

https://www.dawn.com/news/1366135

The Newspaper's Staff CorrespondentOctober 25, 2017QUETTA: The provincial cabinet on Tuesday approved the draft for establishing a medical university in Balochistan.Health minister Mir Rehmat Saleh Baloch made the announcement while speaking at a press conference after a cabinet meeting.“The cabinet has approved the draft of the medical university which would be presented in the current session of the Balochistan Assembly,” he said, adding with the assembly’s approval the Bolan Medical College would be converted into a medical university.Published in Dawn, October 25th, 2017

5 Shia Hazara community members gunned down in Pakistan

http://m.hindustantimes.com/world-news/5-shia-hazara-community-members-gunned-down-in-pakistan/story-CHWR4lYByRHzf2KjHjMloI.html



Five members of the minority Shia Hazara community, including two women, were killed on Sunday in an attack by unidentified gunmen in Pakistan’s restive Balochistan province.This is not the first time that members of the Hazara community have been targeted in Quetta and other parts of Balochistan.(Reuters File Photo)Updated: Sep 11, 2017 00:20 ISTBy Press Trust of India, Press Trust of India, KarachiFive members of the minority Shia Hazara community, including two women, were killed on Sunday in an attack by unidentified gunmen in Pakistan’s restive Balochistan province.The gunmen targeted a car in Kuchluck area of Quetta while it was coming from the Chaman border crossing area, police said.The firing took place when the travellers had stopped at a filling station to refuel their vehicle. Five people of the Shia Hazara community, including two women, died in …

China’s 'Digital Silk Road': Pitfalls Among High Hopes

https://thediplomat.com/2017/11/chinas-digital-silk-road-pitfalls-among-high-hopes/


Will information and communication technologies help China realize its Digital Silk Road?By Wenyuan WuNovember 03, 2017In his speech at the opening ceremony of China’s 19th Party Congress, President Xi Jinping depicted China as a model of scientific and harmonious development for developing nations. Xi’s China wants to engage the world through commerce but also through environmental protection and technological advancement. This includes Beijing’s efforts to fight climate change with information and communication technologies (ICTs) that it plans to export along its “One Belt One Road” initiative (OBOR). Xi may have ambitious plans, but could China be throwing up obstacles in its own way?In his speech, the Chinese president emphasized the need to modernize the country’s environmental protections. The Chinese state is taking an “ecological civilization” approach to development and diplomacy, with a natio…