Analysts said a threat late last week by China's government to slap import tariff on US LNG imports could further push up prices.
China will respond in kind: "China will impose a 25 percent tariff on $16 billion of goods and commodity imports from the United States on Aug 23, a necessary countermeasure to defend its legitimate interests and multilateral trading system", China Daily reports based on a Ministry of Commerce announcement.
"China's yuan gave up earlier gains that came after the central bank was said to have met with major lenders to emphasize currency stability, while mainland stocks fell following their best day in more than two years".
Concerns are also being raised in South Korea about another aspect of the United States trade war-the threat to impose tariffs on cars and auto imports on "national security" grounds, under Section 232 of 1962 legislation. In the face of the U.S. practice of continuously escalating the trade war, China has adopted the principle that "I don't want to fight, I am not afraid to fight, I will fight if necessary".
Alongside the statement, the commission published a final version of the second part of the list on the website of the Ministry of Finance. As Beijing has matched Washington's tariffs, $100 billion worth of trade between the U.S. and China will now be subject to the tariff hike.
"One of these puts the blame on China, saying that "China's strategy is too confident and high-profile, incurring a one-two punch from the United States", it said. This, however, had been held up as Beijing rejigged its film regulator, handing more control to the ruling Communist Party, and then as trade tensions with the United States grew, Reuters reported.
Longer term, electronics sectors in places like Taiwan, South Korea, Malaysia and Vietnam could move into parts of the supply chain now held by China.
The Ministry of Commerce says it would impose tariffs at four different rates (5% to 25%) on the USA goods that would be targeted. In 2017, the Administration launched a self-initiated Section 301 investigation with an in-depth probe into Chinese practices related to forced technology transfer, unfair licensing and intellectual property (IP) policies and practices. The US government is using tariffs as a big stick, which is injurious not only to the country itself, but also the people, for whose wellbeing they claimed to be working.
However, key anti-China hawks in the Trump administration, particularly Lighthizer and White House economic adviser Peter Navarro, insist that Chinese efforts to do the same threaten the economic and ultimately the military supremacy of the United States and can not be tolerated.
Several large American companies have said they would adjust their supply chains to source outside of China if tariffs on Chinese goods impacted them, while China's Haier Group said rising steel prices amid hefty US import tariffs was driving up costs for its business in America. That was off slightly from June's 13.6 percent rate but still stronger than China's global export growth. By contrast, Wall Street continues to perform strongly overall.
Exports rose 12.2pc in July in dollar terms from a year earlier, the customs administration said, faster than the forecast 10pc. It stated that the US-China conflict could reduce world output by 0.7 percent by 2020, with China's economy slowing by 1.3 percent and the US by 1 percent.
"The higher-than-expected imports were pushed up by energy prices, which narrowed the trade balance", said Iris Pang, greater China economist at ING Wholesale Banking in Hong Kong.
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