Beijing, China: China’s tariffs on imported products from the United States worth about 16 billion U.S. dollars took effect at 12:01 p.m. Thursday.
In response to a U.S. tariff move against Chinese products, China decided to impose additional duties of 25 percent on U.S. products, according to a statement of the Customs Tariff Commission of the State Council.
The world’s two largest economies have now slapped tit-for-tat tariffs on a combined $100 billion of products since early July, with more in the pipeline, adding to risks to global economic growth.
The United States and China imposed more tariff hikes on billions of dollars of each other’s automobiles, factory machinery and other goods Thursday in an escalation of a battle over Beijing’s technology policy that companies worry will chill global economic growth. The increases came as envoys met in Washington for their first high-level talks in two months.
They gave no sign of progress toward a settlement over U.S. complaints that Beijing steals technology and its industry development plans violate Chinese free-trade commitments.
The 25 percent duties, previously announced, apply to $16 billion of goods from each side including automobiles and metal scrap from the United States and Chinese-made factory machinery and electronic components.
In the first round of tariff hikes, President Trump imposed 25 percent duties on $34 billion of Chinese imports on July 6. Beijing responded with similar penalties on the same amount of American goods.
The Chinese government criticized Thursday’s U.S. increase as a violation of World Trade Organization rules and said it would file a legal challenge.
Beijing has rejected U.S. demands to scale back plans for state-led technology development that its trading partners say violate its market-opening commitments and that American officials worry might erode the United States’ industrial leadership..
Stocks in Europe are expected to open lower Thursday morning after Beijing implemented new retaliatory tariffs against the United States.
The FTSE 100 is seen down by 20 points at 7,554; the DAX 30 is set to start off by 37 points at 12,348; and the CAC 40 is seen off by 10 points at 5,411; according to IG.
Oil prices slipped on Thursday, weighed down by the escalating trade dispute between the United States and China, although a decline in U.S. commercial crude inventories offered some support.
International benchmark Brent crude oil futures LCOc1 were at $74.54 per barrel at 0647 GMT, down 24 cents, or 0.3 percent, from their last close.
West Texas Intermediate (WTI) crude futures CLc1 were at $67.80 per barrel, down 6 cents from their last settlement, somewhat supported by a decline in U.S. crude inventories.
International markets weakened as the intensifying trade spat between the United States and China was seen as a drag on economic growth.
In U.S. oil markets, a decline in commercial crude inventories provided WTI with stronger support than Brent.
U.S. commercial crude oil inventories C-STK-T-EIA fell by 5.8 million barrels in the week to Aug. 17 to 408.36 million barrels, the Energy Information Administration (EIA) said on Wednesday.
In production, U.S. crude oil output C-OUT-T-EIA rose back to 11 million barrels per day, the EIA report said.
That means the world’s three top producers, Russia, the United States and Saudi Arabia, now all churn out around 11 million bpd, meeting a third of global demand.
Investors are digesting the latest trade news after China officially retaliated against fresh duties, worth $16 billion, from the United States. This takes place at a time when officials from both countries meet in Washington to talk trade.
Stateside, the picture was mixed as strong corporate earnings were weighed down by renewed political concerns surrounding President Donald Trump.
Back in Europe, Chancellor Angela Merkel is reportedly seeking to get a German official at the helm of the European Commission — meaning she will not back her central bank governor, Jens Weidmann, to become the next president of the European Central Bank, Handelsblatt reported.
Thursday’s corporate calendar is thin, but there are plenty of data expected throughout the morning.
The Markit manufacturing and services PMIs for the euro area will be out at 9 a.m. London time; consumer confidence figures are due at 3 p.m. London time and the European Central Bank will publish the latest monetary policy meeting accounts at 12.30 p.m. London time.
EARLIER : China To Impose 25% Tariffs On $16bln U.S. Imports
Beijing, China: China will retaliate against the latest round of US tariffs on Chinese imports with 25% tariffs on $16B worth of U.S. goods, including crude oil and cars, the Chinese State Council announced on Wednesday.
The decision followed the US announcement earlier that it will begin imposing a similar tariff on 16 billion US dollars’ worth of Chinese goods on August 23, 2018.
The Chinese tariffs will take effect on August 23, said the commission.
The US has once again put domestic law above international law by imposing “very unreasonable” new tariffs on Chinese goods, said Chinese Commerce Ministry in a statement on Wednesday.
The ministry said China has to safeguard its own legitimate interests as well as the multilateral trading system by taking countermeasures.
EARLIER : U.S. Finalizes 25% Tariffs On $16bln More China Imports
Washington D.C., USA: The United States will levy another batch of tariffs on Chinese imported goods worth $16 billion, the Office of the United States Trade Representative (USTR) announced today. The USTR also released the list of the 279 products worth $16 billion that will face the additional tariff of 25 percent. The tariffs go into effect on August 23, 2018.
The items all have an individual Harmonized Tariff Schedule (HTS) number and cover sectors including industrial technology, information and communication technology, and medical devices.
Today’s USTR announcement brings the total US tariffs to $50 billion worth of Chinese imports.
On March 22, 2018, President Donald Trump directed the Office of the United States Trade Representative to publish a proposed list of products from China that could be subject to additional tariffs.
In April 2018, the USTR published a list of about 1,300 proposed tariffs on Chinese products. After a public comment period that included 3,200 written submissions and 121 witness testimonies, that list was narrowed down to 818 products that will be subject to an additional tariff duty of 25 percent on about $34 billion worth of Chinese imports.
Customs and Border Protection began collecting these duties on July 6, 2018.
The USTR has also proposed 25-percent tariffs on another 284 goods made in China worth $16 billion. These tariffs underwent a public comment process and hearing in July.
On August 7, the USTR announced that it revised the list of proposed additional tariffs to 279 items worth $16 billion that will go into effect by August 23.
In response to these measures, China has issued retaliatory tariffs that match the U.S. duties. China placed a 25-percent tariff on $34 billion worth of U.S. goods on July 6, 2018, and there are pending tariffs on an additional $16 billion worth of U.S. goods.
In response to U.S. tariffs on 818 Chinese products that were put in place on July 6, 2018, China issued retaliatory tariffs on 545 U.S. imports effective the same day.
The U.S. measure violated the World Trade Organization and goes against a consensus reached in China-U.S. consultations, China’s Ministry of Finance said in a statement.
The Chinese duties match the U.S. tariffs by placing a 25 percent tariff on 545 U.S. goods worth $34 billion. Also pending is a 25 percent tariff on $16 billion worth of additional U.S. products. The timeline for the implementation of these pending tariffs will be announced at a later date, according to the Ministry of Finance.
Here is today’s full USTR announcement unedited:
USTR Finalizes Second Tranche of Tariffs on Chinese Products in Response to China’s Unfair Trade Practices
The Office of the United States Trade Representative (USTR) today released a list of approximately $16 billion worth of imports from China that will be subject to a 25 percent additional tariff as part of the U.S. response to China’s unfair trade practices related to the forced transfer of American technology and intellectual property. This second tranche of additional tariffs under Section 301 follows the first tranche of tariffs on approximately $34 billion of imports from China, which went into effect on July 6.
The list contains 279 of the original 284 tariff lines that were on a proposed list announced on June 15. Changes to the proposed list were made after USTR and the interagency Section 301 Committee sought and received written comments and testimony during a two-day public hearing last month. Customs and Border Protection will begin to collect the additional duties on the Chinese imports on August 23.
In March 2018, USTR released the findings of its exhaustive Section 301 investigation that found China’s acts, policies and practices related to technology transfer, intellectual property and innovation are unreasonable and discriminatory and burden U.S. commerce.
Specifically, the Section 301 investigation revealed:
- China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require or pressure technology transfer from U.S. companies.
- China deprives U.S. companies of the ability to set market-based terms in licensing and other technology-related negotiations.
- China directs and unfairly facilitates the systematic investment in, and acquisition of, U.S. companies and assets to generate large-scale technology transfer.
- China conducts and supports cyber intrusions into U.S. commercial computer networks to gain unauthorized access to commercially valuable business information.
A formal notice of the $16 billion tariff action will be published shortly in the Federal Register. As in the case of the first tranche of additional tariffs, the notice will announce a process by which interested persons may request the exclusion of particular products covered by a tariff line subject to the additional duties.