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A long-running trade war between the United States and China began after the world's two largest economies imposed tariffs on each other. The United States has set up duties on $ 34 billion worth of Chinese goods, to which Beijing responded with levies on a similar amount of US imports
minutes after tariffs came into effect. Americans at 12:01. The trade said: "China has promised not to take the first shot, but in order to safeguard the fundamental interests of the country as well as those of the people, it is obliged to retaliate," according to Xinhua. The ministry has stopped saying that China has implemented its retaliatory measures.
Later on Friday, a spokesman for the Foreign Ministry said that Chinese tariffs had immediately taken effect after the entry into force of US tariffs.
Upstream of tariffs, Chinese state media published a series of editorials criticizing the United States and highlighting the country's readiness for a trade war. Chinese companies and investors have shown the worst, while economists have warned that any impact on the economy would be minimal.
"If the United States wants to start a trade war with China, then so be it." A bit of fighting may be the only way for the Trump administration to clean up and allow everyone to sober up, "said the newspaper" Global Times "on Friday.
"The Trump administration behaves like a gang of thugs with its shakedown from other countries, especially China," an article in English in the China Daily said. On Thursday, a spokesman for the Chinese Ministry of Commerce said that the United States would "open fire on the whole world and open fire on itself."
The Chinese central banker said Trump had promised 25 percent of Friday's $ 34 billion, followed by $ 16 billion in a few weeks, would reduce China's GDP by 0.2 percentage point and Overall impact would be limited, "according to Xinhua.
Yet Chinese investors and companies were worried. The Shanghai Composite index fell 1.1%, after reaching its lowest level in two years this week before recovering after the deadline. Chinese manufacturers have already been hit by a strengthening of the yuan that has made exports more expensive.
China and the United States officially launched a trade war. After months of threats and negotiations, the United States has introduced tariffs of 25% on $ 34 billion worth of Chinese goods just after midnight Friday. In a few minutes, the Chinese Ministry of Commerce said that Beijing was "forced to retaliate".
Earlier this week, Chinese authorities have vowed to avenge US imports such as soybeans, sorghum, automobiles, whiskey and other products. The ministry did not say he had imposed these tariffs on Friday.
In China, authorities are trying to calm fears: policymakers have promised that tariffs would have a minimal impact, reducing GDP by 0.2 percentage point. The Ministry of Commerce is committed to helping the affected Chinese enterprises.
Yet investors and Chinese companies are nervous. Chinese exporters say they have already been hit by a stronger yuan that has made their products more expensive. The main index of the country, the Shanghai Composite Index, has fallen to more than a trough for two years this week. China's high-tech industries, which are part of the Made in China 2025 country initiative to improve manufacturing, will also be affected. The White House tariffs are aimed at curbing the Chinese theft of American intellectual property in these industries.
"In the short term, China will be hit hard … But tariffs will bring double loss results China is never the only one to suffer," said Cheng Dawei, Professor of International Trade at Beijing Renmin University.
"One of the biggest competitive advantages of Chinese exports is their low price.After the imposition of tariffs, the prices of products made in China will increase and we will lose our comparative advantage," said one representative of Sanhua Micro-Channel, which manufactures components for air conditioners in the eastern province of Zhejiang, China
. had already moved some of its production to the United States and Mexico and would probably move more. Others say that they turn their attention to Chinese consumers.
"China is a big market for us, and if we can conquer our own market, we will be less affected by the trade war," said a spokesman for Topsun, a furniture manufacturer in Zhejiang Province.
Chinese tariffs on US agricultural products will also affect Chinese importers. Lu, who runs a store at a fruit retail center in central Beijing, said prices of fruits imported from the United States – subject to duties of up to 50% – would certainly increase.
Yet he understands the American perspective. "Americans want to earn more money for them to start a trade war, I can understand that – who does not want to earn more money?" The Chinese media reported that one Container carriers carrying 70,000 tonnes of US soybeans were racing to reach Dalian Harbor on Friday before retaliatory tariffs were applied. According to Reuters, some Chinese ports have stopped clearing US goods in the expectation of official guidance.
Trump has threatened to raise tariffs if China responds roughly to the total value of Chinese exports to the United States last year of $ 506 billion. He told reporters aboard Air Force One on Thursday, "You still have 16 (billion dollars) in two weeks, and then, as you know, we have 200 billion dollars outstanding and after the 200 billions of dollars, we have $ 300 billion outstanding. "Analysts say tariffs are not the most effective way to put pressure on China, which the United States accuses of commercial practices unfair and stealing intellectual property to US companies.
Mary Lovely, professor of economics at Syracuse University, and Yang Liang, researcher, discovered that 87% of electronic products came from multinationals and of joint ventures rather than Chinese firms
The Chinese economy is no longer dependent on exports Domestic consumption now accounts for more than half of the country's GDP Exports to the United States are only 19% of all Chinese exports.
"Reciprocal tariffs on $ 50 billion worth of goods in both directions will have a minimal impact in China," writes Andy Rothman, investment strategist at Matthews Asia, on a blog this week. China's tariffs on major US exports such as soybean, sorghum and auto are targeting Republican areas ahead of the mid-term elections. "The impact on the American political environment is, however, likely to be much bigger," he said.
High-tech industries in China, including new energy vehicles, robotics and other forms of intelligent manufacturing, which form the industrial plan "Made in China 2025" of the country.
Cheng Dawei, an international business professor at Beijing Renmin University, says that these industries are still in their infancy and that they need channel inputs. Global supply
"In the short term, China will be seriously affected, but tariffs will bring double-loss results, China is never the only one to suffer," she said. . "Imposing high tariffs definitely hurts China, but we will not let ourselves down."
Additional report by Wang Xueying
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