China fired off on Friday in response to President Trump revealing on Twitter that the U.S. would impose a further 10 percent tariff on $300 billion in Chinese imports starting in September.
Chinese foreign ministry was taken by shock. Spokeswoman Hua Chunying referred to Trump’s move as a “serious violation.” She predicted Beijing would be willing to take “necessary countermeasures” if the president decides to impose the tariff.
“We don’t want to fight, but we are not afraid to fight.” Stated Hua on Friday. She added, “China will not accept any extreme pressure, intimidation, and blackmail.”
Since November, Chinese shares have dropped to the lowest point.
The ongoing trade war between China and the U.S., whom both share as the world’s two largest economies, has weighed in on markets all over the world for the past year and a half.
Trump is frustrated with China’s lack of commitment.
He sent the tweets following his meeting at the White House with the trade team. In which the U.S. Trade Representative and Treasury Secretary discussed with the president how the negotiations in Shanghai had gone, and how the discussion reportedly ended quickly.
The White House announced earlier this week that a new meeting had been set up for September.
The president announced that even though the talks were “continuing” the U.S. would start on a “small additional tariff” of the 10 percent on the remaining $300 billion of Chinese products entering into the U.S.
Not including the tariff of 25 percent on the $250 billion, he added.
“We look forward to continuing our positive dialogue with China on a comprehensive Trade Deal, and feel that the future between our two countries will be a very bright one.” Stated Trump.
Directly after Trump’s announcement, Wall Street withdrew on the news, with the Dow Jones Industrial Average dropping from a 300-point accumulation to a deterioration of almost 200 points.
The price of crude oil took a hit by 8 percent on concern over the global result of Trump’s latest salvo. Caterpillar, Apple, and John Deere, all of which have extensive exposure to China, saw their stock decline by around 2 percent on the report. As well as the 10-year Treasury note hit an all-time low since 2016.
Negotiations between the two countries in May came to a halt following Beijing’s 150-page document sent to Washington. Included in the report was China revoking the terms on several previous agreements. With this news, Trump increased tariffs on $200 billion of imported Chinese products to 25 percent, a decision that would raise prices on many consumer goods.
Since last year when the trade war began, China reacted by increasing tariffs of up to 25 percent on an estimated $110 billion of U.S. goods.
The relationship between the two sides further declined following the event of Trump blacklisting Chinese tech giant Huawei. A situation that remained incomplete even after the meeting of Trump and his counterpart, Chinese President Xi Jinping, met this past June.
The International Monetary Fund urged in June that the ongoing controversy could cut global economic production by 0.5 percent going into next year, decreasing economic output by $455 billion.
On Friday, following the tension between President Trump and China. Trump, on a positive note, announced an agreement with Europe to increase beef exports to the European Union. Stating he signed a deal to “lower trade barriers in Europe and expand market access for American farmers and ranchers.” Over the course of the agreement, annual duty-free U.S. beef exports to the EU are expected to increase from $150 million to $420 million says the Representative for the Office of the U.S. Trade.
“This is a tremendous victory for American farmers, ranchers and of course, European consumers,” exclaimed the president as he signed the agreement.
The agreement between the two countries has happened due to the hit that the agriculture industry has taken since Trump’s trade war with China. The president has tried to minimize the economic and political loss from the friction before the 2020 election. It was recently announced that a $16 billion aid package for farmers had been affected by the trade conflict.