New U.S. Tariff Plan on $200 Billion Imports from China; Beijing Warns

The United States has proposed a new plan to increase tariffs on $200 billion worth of imports from China. The Chinese Ministry of Commerce stated in a statement that it will take retaliatory action. The U.S. intends to impose a 10% tariff on $200 billion worth of imports from China. This plan was announced after Donald Trump, the President of the United States, threatened that if China retaliates against U.S. tariffs, Washington will respond again. In mid-July, the U.S. government raised tariffs on some imported goods from China, valued at $34 billion, to 25%. China also announced that retaliatory tariffs 'exactly at the same rate' were immediately implemented. Robert Lighthizer, the U.S. Trade Representative, said on July 19 that 'due to China's retaliation and because China has not changed its behavior, the President [of the U.S.] has ordered the process of imposing a 10% tariff on $200 billion worth of imports from China to begin.' The new measures are expected to impact global markets and the concerns arising from the occurrence of a 'trade war.' Donald Trump has explicitly criticized China's trade policies, American companies' access to its market, and the $375 billion trade deficit between the two sides, demanding 'behavior change' from China through new tariffs. In response, the Chinese government claims that the U.S. benefits from the trade relations between the two parties and that Beijing is not willing to enter a 'trade war,' although it 'is not afraid of it either.' On Wednesday, July 20, the Chinese Ministry of Commerce stated in a statement that the country 'has no choice but to take necessary retaliatory actions.' A senior official from the Chinese Ministry of Commerce also reacted to the new tariff proposals from the U.S., stating that these actions and the responses to them will 'devastate' the trade relations between the two parties. The Assistant Minister of Commerce of China said during a meeting in Beijing that 'the outbreak of tariffs on both sides on a large scale will ultimately lead to the destruction of trade between China and the U.S.' The United States is the largest economy and China is the second largest in the world. However, the increase in tariffs by the U.S. on imports from China is much easier because last year's U.S. imports from China exceeded $500 billion, while China's imports from the U.S. amounted to over $130 billion. Some analysts say that this trade deficit itself makes it difficult for Beijing to counter the new U.S. tariffs. On the other hand, the Associated Press recently reported on ways that China could retaliate, such as targeting American companies, using financial leverage, or even applying diplomatic pressure. In the United States, some critics of China and also allies of Mr. Trump say that the People's Republic must change its behavior so that both sides can fairly benefit from trade. Conversely, critics of tariffs on China, including in the Republican Party, argue that this will lead to increased prices of goods and reduced job opportunities in the United States, affecting the lives of ordinary citizens.