China’s economy shows signs of slowing. A trade war won’t help

Friday, 22 Jun, 2018

The United States has alleged that China is stealing USA intellectual property, a charge denied by Beijing.

Baker says that if China were really determined to strike back at the United States, it would employ what he describes as the "nuclear option" of totally disregarding American companies' intellectual property rights.

In his most scathing comments yet against China, US Secretary of State Mike Pompeo yesterday accused Beijing of following predatory economic policies against the rest of the world. "This would likely violate WTO rules, but I suspect China will care about violating WTO rules as much as Trump does".

"Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong".

In the latest move in an escalating trade dispute, President Trump announced Monday evening that he was asking U.S. Trade Representative Robert Lighthizer to suggest $200 billion worth of Chinese goods on which the U.S. could impose a 10 percent tariff.

The Trump administration on June 15 said that it will impose a 25 per cent tariff on $50 billion of Chinese exports. Soybeans, which are on Beijing's list of U.S. goods to retaliate against, fell to their lowest level in more than two years.

Canada imposes such onerous tariffs on US products - shoes, for instance - that people are forced to "scuff 'em up" in order to "smuggle" them home, the president said, seemingly confusing tariffs with duties.

Being tough with China plays well with many of President Trump's supporters, actual and potential, at a time when he is looking ahead to the Congressional elections in November.

"This all shows how quickly trade tensions could escalate between the U.S. and China", said Derek Halpenny, European head of global markets research at MUFG Bank.

Fears the spat between the world's two largest economies could intensify added to pressure on oil prices, which extended Friday's big fall into the start of week, while the dollar retreated from a seven-month high against a basket of currencies.

Tariffs are already raising costs for some goods.

These penalties would go into effect, the president said, "if China refuses to change its practices" and proceeds with its plans for retaliatory tariffs.

According to the New York Times, however, Trump's story from a major newspaper comes from an opinion piece from Canadian journalist Isabel Vincent.

In an official statement, Trump said that these new tariffs would be in retaliation for China threatening to impose retaliatory tariffs on USA goods in response to the last round of tariffs imposed on China by the U.S. -China Business Council. He asked whether that might include delaying or denying licenses required by US companies.

The Chinese retaliation pattern shows that China intends to follow Donald Trump with "equal scale and equal strength" on every move he takes against China.

Kim Hyo-sun tells us more. The Trump administration, they said, has forgotten an important lesson from the Great Depression.

"For many American families, these increased costs will wipe out any gains from tax reform", said Hun Quach, vice president of worldwide trade for RILA.

Shares in supermarket Tesco, Britain's biggest retailer, meanwhile jumped 2.6 percent after the company reported solid first-quarter sales.

In a meeting at the White House last month with the president and his top economic advisor Lawrence Kudlow, Cook told the pair that tariffs placed on Chinese imports were like a tax on USA consumers.

"We use American power, economic might and influence as a tool of economic policy", he said.