US considering China tariff escalation amid reports of new dialogue

The US could announce plans to more-than-double its proposed tariffs on Chinese imports as early as Wednesday this week, according to media reports.

The Trump administration is considering raising tariffs on US$200 billion of Chinese goods, due to take effect in September, to 25 per cent, the BBC reports. The proposed tariffs on more than 6,000 items are currently set at 10 per cent.

The decision, which the South China Morning Post reports could be announced on Wednesday (1 August), would ‘up the stakes’ in the US-China trade war.

Responding to the reports, China’s Foreign Ministry spokesperson, Geng Shuang, said further US tariffs “can only be counterproductive,” adding that “China will inevitably counter the threat,” Xinhua reports – making further ‘tit-for-tat’ escalation highly likely.

However, sources say that tentative efforts are being made behind the scenes to open up a new dialogue between the world’s two largest economies following the collapse of talks in June.

Bloomberg reports that representatives of US Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are having private conversations as they look for ways to re-engage in negotiations, providing a glimmer of light amid the trade war gloom.