Trump’s tariff threat puts China’s leader in a bind

Donald Trump said he would hike US tariffs on $200 billion worth of Chinese goods this week

President Donald Trump's threats to increase tariffs on China sent global markets plunging as fears increased that the trade war between the United States and China could expand. Although Trump leveling new import tariffs is something that the world has become accustomed to, the fact that he did so prior to what many felt would be a springtime end to his so-called trade war on China left many bemused. But on Sunday, President Donald Trump unexpectedly expressed frustration at the pace of talks and vowed to raise tariffs on $200 billion in Chinese products from 10% to 25%. The US President has also warned that his administration could tax almost all of the roughly $500 billion of Chinese exports to the United States.

United States negotiators are reported to have become frustrated by China's attempts to backpedal on earlier commitments made over the deal, including one related to forcing foreign companies to share their technology. As of this Friday there will be a flat 25% tariff across the board, with $325bn of now untaxed goodies getting the same treatment.

Vice Premier Liu will meet with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, on May 9 and 10, according to a statement Tuesday on the Chinese Ministry of Commerce website. He said China had retreated from specific commitments, a move that would have led to substantive changes in the text of the deal.

"We urge the President to refrain from imposing these additional tariffs and instead focus on negotiating and concluding the trade deal with China", said Rick Helfenbein, president and CEO of the American Apparel & Footwear Association."These taxes are not paid by foreign nations and they result in higher costs that are simply passed on to the American consumer". For weeks, Trump administration officials had suggested that negotiators were making steady progress.

A spokesman at the Chinese Embassy in Washington did not immediately respond to queries about the USA claims.

At the same time, a Chinese trade delegation is expected to arrive in Washington to resume negotiations on Thursday, a day later than originally planned.

The United States now has 25 percent tariffs on $50 billion of Chinese machinery and technology goods, and 10 percent tariffs on $200 billion of products ranging from computer modems and routers to furniture, lighting and building materials.

Reuters reported, citing a person familiar with the talks, that the change in language was tied to Beijing's desire to implement changes to its economy, granting the USA greater access to its markets, by means of administrative and regulatory actions instead of legislation, as had earlier been negotiated.

After the tweeted announcement, where all United States policy now seemingly gets its first airing, the country's top trade negotiators have confirmed that they will be moving ahead with the threatened extra tariffs. 'The Tariffs paid to the US have had little impact on product cost, mostly borne by China.

Trump's Twitter comments on Sunday about the new tariffs sent Asian stocks and USA futures tumbling Monday and added uncertainty over the future of U.S.

"They have their internal politics, too", said Michael Pillsbury, director of the Hudson Institute's Center on Chinese Strategy and an adviser to the Trump White House.

"We think China trade talks will negatively impact our universe". The U.S. -China standoff is reducing global trade and creating uncertainty for companies deciding where to buy supplies, build plants and make investments. With China, we lose 500 billion dollars.

ENERGY: Benchmark U.S. crude lost 7 cents to $62.18 per barrel in electronic trading on the New York Mercantile Exchange.

Negotiations on removing punitive USA tariffs has been one of the remaining sticking points. In the drive to create a moderately prosperous society in all respects, China sought to increase imports by enacting policies friendly to ever freer trade with partners from around the world.

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