China vows to hit back over U.S. proposal for fresh tariffs

BEIJING / WASHINGTON (Reuters) – China accused of the United States of America and the United States of America, said it would be a hit after the Trump administration raised its stakes in its trade, threatening 10 percent tariffs on $ 200 billion of Chinese goods and rattling global markets.

China's trade ministry said on Wednesday it was "shocked" and would complain to the World Trade Organization, but did not immediately say. In a statement, it called the U.S. actions "completely unacceptable".

The Chinese foreign ministry said Washington's threats were "typical bullying" and described the dispute as "fighting between unilateralism and multilateralism".

U.S. Official on Tuesday issued a list of thousands of Chinese goods to be hit with the new tariffs. The top items by value were $ 29 trillion of imports in 2017, $ 20 trillion worth of networks worth $ 23 billion.

The list is subject to two-month public comment period.

Some U.S. business groups and lawmakers from President Donald Trump's own Republican Party who were responsible for escalating tariffs. The Republican-controlled Senate voted 88-11 in favor of a non-binding resolution calling for a tariff.

Republican US Senate Finance Committee Chairman Orrin Hatch said the US announcement "appears reckless and is not a targeted approach." Republican US House of Representatives Speaker Paul Ryan accused China of unfair trade practices added, "I do not think tariffs are the right way to go. "

The US Chamber of Commerce Trump's domestic tax cuts and efforts to reduce regulation of businesses, but does not back Trump's aggressive tariff policies.

"Tariffs are taxes, plain and simple. Imposing taxes on another $ 200 billion worth of products for American families, "Chamber spokeswoman said.

Among the potential ways Beijing could hit the back of "qualitative measures," a threat that U.S. businesses in China feared that it would be better than ever before.

HOLDING UP LICENSES

The Wall Street Journal, quoting unnamed Chinese officials, said Beijing was considering holding licenses for U.S. companies, delaying approvals of mergers involving U.S. firms and stepping up border inspections of American goods.

China could also limit visits to the United States by Chinese tourists, a business that state media said is worth $ 115 billion, or shed some of its US Treasury holdings, Iris Pang, Greater China economist at ING in Hong Kong, wrote in note.

The $ 200 billion far exceeds the total value of goods China imports from the United States, which means the size of the United States.

It also highlights how dependent U.S. businesses and consumers are on Chinese goods. In trump's first round of tariffs, China accounted for 20 percent of total imports. In this round, China accounted for more than half of the imports.

There was a price paid by American companies as government policies legislated winners and losers.

China supplies 65 percent of U.S. furniture imports, based on analysts at Goldman Sachs.

The prospect of a 10 percent tariff on Chinese furniture imported from WayFair Inc. ( WN ) down nearly 4 percent, while shares of Restoration Hardware ( RH.N ) tumbled nearly 6 percent.

Auto parts retailers, which would also be affected by the U.S. lobbed at China. Shares of Advance Auto Parts Inc. ( AAP.N ) were down 1.6 percent, Autozone Inc. ( AZO.N ) fell 1.8 percent and O'Reilly Automotive Inc. ( ORLY. O ) almost 2 percent.

Investors fear an escalating Sino-American trade war could hit global growth and damage sentiment.

By early afternoon, the Dow Jones Industrial Average .DJI was down 0.72 percent, the S & P 500 was down 0.65 percent, and the Nasdaq was off 0.62 percent.

The MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 1.12 percent, while the main indexes in Hong Kong .HSI and Shanghai .SSEC recovered somewhat after falling more than 2 percent.

Trump has been following through on the pledges of China, which he accuses of unfair trade practices including theft of intellectual property and forced transfer to a $ 375 billion US trade deficit. China.

The U.S. president has said he may ultimately impose tariffs on more than $ 500 billion worth of Chinese goods, roughly the total amount of U.S. imports from China last year.

The new list targets many more consumers covered under the tariffs imposed last week, raising the issue of direct threat to consumers and retail firms and increasing the stakes for Republican U.S. lawmakers facing elections in November.

U.S. financial analysts said Trump appeared to believe that it was a political advantage to trade war, that it could change quickly amid economic fallout.

"Elena Duggar, an associate managing director at Moody's, the credit rating agency, said:" It is now more likely that the dispute will continue for a longer period of time.