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Beijing wants to respond to American measures with counter-duties on Friday. This could affect US products for $ 34 billion. Stock markets nervous. Merkel tries to defuse.
18:28, 04 July 2018
The tariff dispute between The world's largest economic powers, China and the United States, are threatening to grow in a spiral of retaliation. The People's Republic wants to increase tariffs on American goods from Friday, up to 34 billion dollars (1965).
It would be a kind of reprisal strike since US President Donald Trump has already Friday's customs duties on the goods of the Middle Kingdom announced to the same extent. The Finance Ministry in Beijing said China would not give the "first blow" in a trade war. Customs measures would not be taken before the United States
Meanwhile, the EU is trying to avoid a further escalation of the trade dispute with the United States, which also causes nervousness over stock markets. "It is worth defusing this conflict, so that it does not become a real war," said German Chancellor Angela Merkel . She referred to an ongoing trip by the President of the European Commission Jean-Claude Juncker to the United States to resolve the dispute. The smooth functioning of the global economy depends on good cooperation.
Collaboration
According to internal sources, Beijing's leaders are pushing the EU to join forces against Trump's protectionist line. China is pressuring the EU to adopt a strong joint declaration at the Sino-European summit to be held in Beijing on 16-17 July, several European officials said. As a result, an alliance between the two parties and a joint action against the United States at the World Trade Organization (WTO) have been proposed. However, the EU is against, said a European diplomat. "China wants the European Union to stand up against Washington with Beijing, let it take sides, and we will not do that."
The United States is resisting more and more at the international level with its foreclosure policy. Many states have criticized the WTO for tariff plans of the United States regarding the import of cars and auto parts. More than 40 countries, including the 28 EU countries, warned participants Tuesday of a global market disruption and a threat to the WTO system. Japan said additional tariffs on cars could trigger a spiral of countermeasures and lead to the collapse of the rules-based international trading system. According to the WTO, the trade dispute is already affecting the global economy. The establishment of trade barriers could undermine the global economic recovery, said WTO chief Roberto Azevedo
Nervous investors
The intensification of the trade dispute is also putting pressure on the stock markets Chinese. The index of the Shanghai Stock Exchange rose 0.9% down. Investors are becoming more nervous about weeks of devaluation of the local currency Yuan. Since mid-June, it has devalued about four percent. On Tuesday, the central bank tried to calm down verbally. On Wednesday, prices stabilized.
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