Shares knocked lower after new USA tariff threat on Chinese goods


The US is imposing new tariffs on $200bn (£150bn) worth of Chinese goods as it escalates its trade war with Beijing.

A 10 percent tariff will be implemented on $200billion (£152billion) of Chinese goods on September 24, rising to 25 percent at the start of 2019, according to the United States leader.

Trump also threatened to add tariffs on about $267 billion of additional imports if China retaliates against US farmers or other industries.

President Trump said he will make a major announcement on trade with China after the markets closed Monday.

Trump promised "some very positive news" on and said that "it will be a lot of money coming into the coffers".

The United States had proposed the talks, but at the same time moved forward with planning additional tariffs on some $200 billion of Chinese products.

The message will be especially poignant to Canada, with which the now engaged in a trade stand-off, and Europe, a heavy bearer of steep steel and aluminum tariffs introduced earlier in the year by the president.

The U.S. had already imposed tariffs on $50 billion in Chinese imports. Chinese officials have signaled they'll refuse to meet with Mnuchin if this next round of tariffs is imposed, according to two people familiar with the discussions.

Charlene Barshefsky, another Clinton administration trade representative who is widely credited as brokering China's entry into the WTO, said that in a period of globalisation that is driven by East Asia, the question for the U.S. was "Are we in or are we out?"

The Wall Street Journal reports, the measures could be announced as early as Monday.

Trump administration is seeking systemic changes from China which Beijing has failed to do. However, because China exports more to the USA than it imports there are limits on the amount of tariffs Beijing can impose on American goods. These new tariffs would reportedly take effect "within weeks".

Michigan Governor Rick Snyder, known as a moderate Republican and a former computer executive, told Reuters on a trip to China that the anxiety and uncertainty around tariffs risked limiting Chinese investment in the United States. China has said it will respond to the next round of USA levies with retaliatory tariffs on US$60 billion of USA goods ranging from liquefied natural gas to aircraft.

Last week, Beijing said it welcomed overtures from USA officials offering to re-start trade talks, but press reports indicate China would call off any meetings if the new punitive duties take effect. I have a lot of respect for China. But Trump quickly backed away from the truce. Apple Inc. said last month the proposed duties on US$200 billion cover a wide range of products used in its USA operations.

Adding in the $200 billion list and another $267 billion of Chinese goods, total imports from China facing tariffs would exceed the $505 billion in goods that the United States imported from China past year.