Trump issues new tariff threats against China

Trump issues new tariff threats against China

27/11/18

Indira Zahra, Business & Policy Intern

US President Donald Trump has issued new threats to place tariffs on the remaining $267 billion of Chinese imports not yet subject to duties, Wall Street Journal reports. The latest development in the trade war comes ahead of the high-stakes meeting between President Trump and his Chinese counterpart President Xi Jinping, scheduled for the G20 Summit in Buenos Aires later this week.

Unless the two sides can reach an agreement, Trump said it is “highly unlikely” that the US will hold off on raising current tariffs – which has already been levied on $250 billion of Chinese imports this year –  with another hike from 10% to 25% expected to take effect on January 1, 2019, South China Morning Post reports.

Financial Times reported mixed reactions in Asian markets, with the Chinese CSI 300 Index up 0.2%, and the Japan Topix up 0.3%. Hong Kong’s Hang Seng and its China Enterprises Index, however, was down by 0.6% and 0.7% respectively. Bloomberg reported declines in Europe, with the pan-European STOXX 600 down 0.4%. The US faced similar trends, with the S&P 500 Index down 0.3%.

Adding uncertainty to the global economy, the statement dimmed hopes of a truce to the ongoing trade war. The OECD lowered its global growth forecast from 3.7% to 3.5% in its latest economic outlook, highlighting trade tensions as one of the main reasons, along with volatility in oil prices, Brexit, and the fragility of several Eurozone banks.