The latest round of U.S. tariffs on $16 billion worth of Chinese goods took effect on Thursday, immediately sparking a reaction from Beijing which retaliated with duties on American imports worth the same amount.
The latest developments come at a time when trade officials from both countries have engaged in tariff negotiations in the United States, CNBC reports.
Additional 25 percent tariffs were levied on a number of Chinese products, including semiconductors, chemicals, plastics and other imports from 279 categories identified by U.S. Trade Representative.
China, on its part, retaliated by imposing its own duties on U.S. imports, among which fuel, steel products and medical equipment. The new $16 billion worth of tariffs took effect at 12.01 a.m. EDT on Thursday, the same time as those levied by the United States, China’s Customs Tariff Commission of the State Council said.
An online statement by the Chinese Commerce Ministry said that it “resolutely opposes” the latest set of levies which it vowed to fight back against. It further said that the country will file a complaint to the World Trade Organization against the United States.
Last month, the U.S. imposed tariffs on $34 billion worth of Chinese goods, prompting U.S. importers to place additional orders to be shipped and delivered ahead, which in turn was cause for higher ocean and air freight rates, as well as for elevated warehousing costs in America.
“If trade war actually continues, prices for products across many industries will increase,” said Henry Ko, managing director for Asia at Flexport.
Officials from the world’s two largest economies, led by U.S. Treasury Under Secretary David Malpass and Chinese Commerce Vice Minister Wang Shouwen, met on Wednesday in Washington, but talks are not expected to yield much.
“I don’t see this ending soon, that’s for sure,” said Scott Kennedy, deputy director of the Freeman Chair in China Studies at the Center for Strategic and International Studies. “The gulf between the Trump administration and the Chinese is as wide as the Pacific and it looks like it’s getting wider because the Trump administration thinks they are winning.”