China hits back at Pompeo; accuses U.S. of blackmail tactics
- Author: Eleanor Harrison Jun 22, 2018,
Jun 22, 2018, 3:28
President Donald Trump has directed the US Trade Representative to prepare new tariffs on 200 billion dollars (£150 billion) in Chinese imports as the two nations moved closer to a potential trade war.
On Friday, after the Trump administration's first tariff action, Beijing responded with reciprocal tariffs on $50 billion in US goods, including cars, soybeans, dairy, oil, propane and other high-value trade categories. Those tariffs were matched by China's threat to penalize on USA exports, a move that drew the president's ire.
"China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology", Trump said in a statement Monday. "Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong", he said.
"[They would take effect] if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced", he said.
China's Commerce Ministry on Tuesday criticised the latest threat of tariffs, saying it was an "act of extreme pressure and blackmail that deviates from the consensus reached by both parties after many negotiations, and is a disappointment to the global community".
"If the USA acts irrationally and issues a list, China will have no choice but to take comprehensive measures of a corresponding number and quality and take strong, powerful countermeasures". (Seipi), the largest organization of foreign and Filipino electronics companies in the Philippines, concedes that the country's $33-billion electronics exports, which yearly account for at least half of outbound goods, would be severely affected by a US-China trade war. Many US trading partners reacted by raising their own tariffs, which contributed to shutting down global trade.
The tariffs are scheduled to take effect in July, leaving some room for discussions to head them off.
Analysts say Beijing is determined to develop its technological prowess and create world-leading companies in such fields as robotics and electric cars under a program it calls "China 2025".
"There's definitely some element of pressure here as we go through the trade war fears, as well as the rhetoric for tariffs", said Sid Mokhtari, executive director of institutional equity research at CIBC.
For some companies, the exposure to China is far higher: US tech giant Qualcomm generates 63 percent of its revenue in China and needs Chinese authorities to approve its takeover of semiconductor maker NXP.
He said China's recent claims of "openness and globalisation" are "a joke". The US products subject to tariffs in China will be mainly within agriculture, seafood and autos. "It's an unprecedented level of larceny". "This is predatory economics 101". Apple didn't respond to a request for comment on Tuesday morning. "President (Donald) Trump is now working to re-shift this balance", Pompeo was quoted as saying.
"I reminded him that's not fair competition", Mr Pompeo said.
A rush to beat the tariffs imposed by the United States and China in the latest trade spat could spark a change in freight movements and rates.
The exchange of blows between Washington and Beijing has heightened fears of a protracted dispute that could hurt global growth and particularly Europe, given that Trump has signalled he wants to impose tariffs on automotive exports.
Wall Street has viewed the trade tensions with rising concern that they could strangle the economic growth achieved during Trump's watch.