Friday, July 6 is the day when the world's two largest economies are expected to plunge deeper into a trade conflict that has shaken markets and clouded global growth prospects.
In Beijing, policymakers If the US begins to impose high tariffs on Chinese imports as early as Friday, then Beijing is ready to respond in kind. With other levies under threat, this week could mark the beginning of a new dangerous phase.
The imposition by the United States of $ 34 billion on China's exports will not only hurt China, but also the United States and Canada. Gao Feng, spokesman for the Chinese Ministry of Commerce, said Thursday at a regular press conference in Beijing. According to the customs authorities, China's retaliatory tariffs will come into effect " immediately" after US laws.
All you need to know about the burgeoning trade war
In the conflict:
On June 15, President Donald Trump declared that the United States would start imposing additional duties of 25% on Chinese imports of $ 50 billion in response to what he said was a robbery. of American intellectual property. China responded by stating that it would respond "on an equal scale, at equal intensity". Beijing targets soybeans, corn, wheat, rice, sorghum, beef, pork, poultry, fish, dairy products, nuts and vegetables, and automobiles in its first round of countermeasures
Read about American and Chinese tariff schedules
When will this begin? 19659013] The first wave of US duties on $ 34 billion of Chinese exports will come into effect on July 6, according to a statement by the US trade representative, who did not specify a deadline. China's response to additional duties on US goods will take effect "immediately" thereafter. If US tariffs arrive at midnight Friday, it's Friday midday in Beijing
How will it be implemented?
Chinese customs will adjust their systems so that the new tariffs begin to be billed after the United States. When the products on the list for additional tariffs are declared to customs, the importer will pay the additional levies.
The reporting rules vary for different products, according to Xu Qing, a saleswoman at Reg & # 39; s, a Shanghai-based logistics company that provides customs services. customs clearance service to Chinese importers. Time-sensitive products such as fresh seafood and fruits can be declared before arrival, while for products such as auto parts and soy, this can only be done after being arrived on the docks.
In recent weeks, fears over the trade war have mixed with fears about how a debt control campaign will continue to affect economic growth prospects.
The Chinese stock index index closed at 0.9 "
" All eyes are turned to the decision of the Trump administration to impose the additional 25% tariff Friday and the following after, "said Zhang Gang, Central China Securities Holdings strategist in Shanghai." The trade war is a constant asset to the markets and I do not think it will be withdrawn anytime soon. "
The yuan remained unchanged on Thursday despite the highest daily benchmark since October, with the Chinese currency experiencing its worst quarter since 1994 in the three months following June, raising questions as to whether the government will was deliberately slipping as a tactic in the trade war.
What can be the real impact? tariffs already have an effect.For example, Chinese companies resell US soybeans and Chinese companies should cancel the Most of the rest of the soybeans that they pledged to buy in the United States during the year ending August 31, once the extra rates caught Xu, the saleswoman of the logistics company , said that some of its customers are planning to divert goods to other countries, to import less from the United States or to negotiate with their US counterparts to see if they will lower prices.
In China, what will be the economic impact?
It depends on what happens. In the scenario where the United States and China stick to this series of tariffs – $ 50 billion in imports – and would not go further, the growth of the US $ 50 billion was not enough. Chinese economy would be 0.2 percentage point in 2019, according to Bloomberg Economics
If things get worse, the blow will be more important, reducing by half a point of growth . China's economy grew by 6.9% in 2017 and the government set a target of 6.5% for the current year.
Read about our impact calculations if the trade war intensifies
19659034] The Chinese coastal provinces are the main source of exports to the United States. United.
Sources: National Bureau of Statistics, Provincial Government Websites
"The Risk of a Sino-US Trade War Becomes More Important" Senior Economist at BNP Paribas Asset Management in Hong Kong. "Both parties may misjudge the intentions of the other when patriotism takes over rationality, and push itself into a series of attacks and retaliation."
