Trade war continues to escalate | “Tarrif Man” Trump doubles down on Chinese goods | China expected to retaliate
United States more than doubled tariffs on $200 billion of Chinese goods, as global markets sweat from repercussions of the rapidly escalating trade war.
“It has been ordered to “begin the process of raising tariffs on essentially all remaining imports from China, which are valued at approximately $300 billion,”said the Office of the United States Trade Representative
- U.S. President Donald Trump referred to himself as a “Tariff Man”.
- Trump claimed the duties he has imposed on a range of goods and metal imports are filling up state coffers.
- China is set to retaliate after it responded saying it will not swallow any ‘bitter fruit’.
- Trade war has left importers in both countries feeling the heat of increasing tariffs.
Consumers are hard hit
Taxes are applied on goods coming into the US from China. American importers are responsible for paying them. But only some absorb the cost whereas most of them pass it onto the consumer.
Small-time importers are the worst hit
Most importers in China are Chinese and likewise most are American in the US. The U.S. government receives import taxes on Chinese goods from U.S. importers, whereas the Chinese government is receiving the increased taxes on U.S. goods from Chinese importers.
This has lead to the small-time private importers feeling the pain as increased tariffs continue to diminish their razor-thin margins.
Casualties on both the sides
The increased tariffs make consumers and importers less likely to purchase Chinese goods, hitting exporters and finally Chinese GDP. Reciprocal tariffs, like those imposed on struggling US soybean producers, hurt US exporters too, even while their effect on overall GDP has so far been negligible.
China is increasingly looking elsewhere for trade partners, while the US is part-victim of its own policies. The trade war is witnessing casualties on both the sides and impacting the world markets.