Economy

White House expects China to retaliate over trade tariffs

White House expects China to retaliate over trade tariffs

President Donald Trump has warned Chinese President Xi Jinping and all of his "many friends in China" that the country "will be hurt very badly" if they don't agree to a trade deal.

On Friday, Trump raised tariff on $200 billion of Chinese goods from 10 percent to 25 percent.

On Friday Mr Trump tweeted that tariffs on $250bn of goods coming into the U.S. were being paid "by China".

Mr Kudlow also said that President Donald Trump's plan to raise United States tariffs on Chinese goods across the board could take months to take effect.

"It is not China that pays tariffs, it's the American importers, the American companies that pay what in effect is a tax increase and oftentimes pass it onto United States consumers", Wallace said, prompting Kudlow to agree, albeit with a reservation.

"Things seemed to be taking too long, and we can't accept any backtracking", he said on "Fox News Sunday".

Mr Trump said a process had begun to place the full 25% tariff on a further $325bn of Chinese goods, causing concern over the impact the ongoing tit-for-tat trade spat between the world's two largest economies might have on global growth.

"Trade talks have come to a deadlock and it's unlikely we'll see the situation turn for the better in the near term", said Raymond Chen, a portfolio manager with Keywise Capital Management Beijing Ltd. They said that loss could widen to 1 percentage point if both sides extend penalties to all of each other's exports. China had previously imposed taxes on $110 billion of American products, but has not said how it might retaliate against Trump's latest increase in tariffs.

"Well if it's a tariff on goods coming into the country, the Chinese aren't paying", Wallace pointed out.

More news: Mohamed Salah, Sadio Mane and Aubameyang all win Golden Boot

Wei Jianguo, a former vice-minister at the Ministry of Commerce (Mofcom) responsible for foreign trade, said China still has abundant tools in its armoury and has already prepared a contingency plan to deal with the escalation of the trade war.

He downplayed concerns that the tariffs would lead to US job losses and hurt the GDP.

Taylor said China's attitude towards the tariff hike meant that China will not tolerate anything less than an equal standing in the negotiations.

State media also kept up a steady drum beat of strongly-worded commentary on Monday, reiterating that China's door to talks was always open, but vowing to defend the country's interests and dignity.

"If they weren't being seriously provoked, the Chinese people would not favor any trade war".

The jewel in the crown of the US aviation market, Boeing, was expected to be a beneficiary of a US-China trade deal.

Two presidential hopefuls slammed President Trump for his approach to dealing with China, saying it doesn't appear he has a serious strategy.

The president argued there was "no need to rush" into a trade agreement with China, as the US Treasury was benefiting from these "massive payments". Economists say more might follow to reduce the risk of American tariff hikes.

Losing some U.S.jobs and taking a hit to growth was a reasonable risk to take to correct "decades" of unfair trade practices by Beijing, especially because the USA economy is strong, Kudlow said.