Trade War Latest News

Trade War Latest News

Trade War Latest News

The Chinese commerce ministry has slammed the US plan to impose tariffs on additional imports worth some $200 billion as totally unacceptable, promising a mirror response to defend its national interests.

“The Chinese side is shocked by the actions of the US,” a statement on the ministry’s website declared. “In order to safeguard the core interests of the country and the fundamental interests of the people, the Chinese government will, as always, have to make the necessary counter-measures.”

Calling Washington’s behavior irrational, Beijing warned that the US is, in the first instance, hurting itself with protectionist measures and constant attacks on free trade. “At the same time, we call on the international community to work together to safeguard the rules of free trade and the multilateral trading system and jointly oppose trade hegemony,” it added.

On Tuesday, the Trump administration unveiled a list of Chinese exports worth $200 billion that it plans to slap with 10-percent tariffs. The measure would be another step in what Beijing called “the largest trade war in economic history,” as Washington implemented 25-percent tariffs on $34 billion of Chinese imports on July 6. China issued retaliatory measures on the same value of US imports, and vowed to respond proportionally to any further US tariffs.

China is not the only nation to face the consequences of US President Donald Trump’s protectionist policies, with longstanding US allies – the EU and Canada – also being subjected to harsh tariffs on steel and aluminum imports.

President Vladimir Putin has signed a law extending the embargo against countries that have imposed sanctions against Russia. Restrictions will be in force until the end of next year.

The government is instructed to take all measures necessary to implement the decree. The document came into force on the day of signing, on July 12.

In August 2014, Russia banned imports of certain agricultural products, raw materials and foodstuffs from countries that target Russia with sanctions. They include the United States, the European Union, Canada, Australia and Norway. The ban includes meat products, fish, seafood, fruits and vegetables, and dairy products.

The US and its allies imposed sanctions against Russia after accusing the country of annexing Crimea and supporting rebels in Eastern Ukraine.

Moscow insists it is not involved in the Ukrainian conflict and that the Crimean referendum overwhelmingly supported reunification with Russia.

The foreign food embargo has given a boost to Russian agriculture. Since the introduction of Western sanctions in 2014, Russia has become the world’s largest grain exporter, producing the largest harvest in forty years.

“These measures give us the right to protect our market from the influx of dumped products. The also protect the interests of our domestic producers,” the chair of the Russian State Duma’s Agriculture Committee, Vladimir Kashin, said.

The U.S. Senate on Wednesday overwhelmingly approved a non-binding motion to give Congress a role in deciding whether tariffs should be imposed on the ground of national security under Section 232 of the Trade Expansion Act.

The Senate adopted the motion by a vote of 88 to 11 to direct the Senate and House conference committee to include language “providing a role for Congress in making a determination under Section 232 of the Trade Expansion Act of 1962” in the final Energy and Water Appropriations Bill.

“The Senate spoke loud and clear by overwhelmingly expressing support for our efforts to ensure Congress plays its appropriate role in the implementation of national security-designated tariffs,” Senate Foreign Relations Committee Chairman Bob Corker said Wednesday in a statement.

“Tariffs are a tax on the American people, and as the U.S. economy and American businesses and consumers begin to feel the damaging effects of incoherent trade policy, I believe support for our legislation will only grow,” he said.

Corker and several other senators last month introduced legislation that would compel President Donald Trump to get congressional approval before imposing Section 232 tariffs on the ground of national security.

“We will continue to push for a binding vote and are hopeful one will be scheduled in the near future,” Corker said.

The Trump administration has used Section 232 to unilaterally impose additional tariffs on steel and aluminum imports, drawing strong opposition from the domestic business community and U.S. trading partners.

“The administration is wrong to use ‘national security’ as a pretext to impose taxes on steel and aluminum from our closest allies,” Senator Pat Toomey from the state of Pennsylvania said in a statement.

“It’s time for Congress to reassert its constitutional responsibility on trade and today’s bipartisan vote shows that there is a way forward to accomplish this,” he said.

On March 8, Trump officially signed proclamations imposing a 25-percent tariff on imported steel and a 10-percent tariff on imported aluminum pursuant to Section 232.

On May 23, he instructed the Commerce Department to launch an investigation into automobile imports under Section 232, which would allow Washington to introduce tariffs on national security grounds. The investigation may lead to an increase in tariffs up to 25 percent.

These measures have provoked widespread opposition from U.S. lawmakers, business groups and major trading partners.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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