China to hit USA with tariffs on United States imports worth $16bn

Trump's mission to reduce the USA trade deficit via the threat of tariffs has brought him into conflict with China as well as U.S. allies, roiling financial markets and raising fears of a global trade war the International Monetary Fund has warned may undermine the strongest economic upswing in years. Washington applied a 25% tariff on Chinese imports including airplane tires and various industrial parts.

Still, disagreements between the two major economic powers run deeper than just the trade balance and tensions remain over market access, intellectual property, technology transfer and investment.

On Tuesday, the Trump administration said it would begin collecting previously announced 25% tariffs on an additional $16bn of Chinese goods from 23 August.

After months of escalation, business communities in both countries are wondering when and how the trade confrontation will end.

China's exports growth unexpectedly accelerated in July despite fresh USA tariffs, while its trade surplus with the United States remained near record highs as Beijing and Washington ramped up a bitter dispute that has rattled financial markets.

"With each successive round of tariffs, Trump continues to back China into a corner, forcing Beijing to respond in kind", said James Zimmerman, a partner in the Beijing office of worldwide law firm Perkins Coie and a former chairman of the American Chamber of Commerce in China.

A weaker yuan, which marked its worst 4-month fall on record between April and July, may have taken the sting out of 25 percent tariffs on $34 billion exports to the United States.

Economists warn that a prolonged trade war between China and the USA could end up increasing prices for American consumers and hurting USA businesses.

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China has been retaliating in kind.

May 19: After a meeting, the two countriesannounce the outline of a trade dealto avoid the tariffs.

Wednesday's knee-jerk reaction to the announcement of the tariffs was a typical move by traders. He further added that his refinery had cancelled USA crude imports and would switch to Middle East or West African supplies instead.

July 10: TheUS releases an initial listof an additional $200 billion worth of Chinese goods that could be subject to a 10% tariff.

Washington imposed 25% duties on $34bn (£26.3bn) of Chinese goods on 6 July in response to those complaints.

Farmers and United States industries have been caught in the crossfire, and the Trump administration announced $12 billion in aid to help farmers hurt by duties on crops such as soybeans.

According to the Chinese Ministry of Commerce, the measure will come into effect on August 23, the same day as America's latest levies.

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