The so called ‘Leader of the Free World’ Donald Trump carried out his weekend threat to China and imposed tariffs on another USD200bn of Chinese goods overnight, starting on the 24th September at 10% then increasing to 25% in 2019, it seems to allow US industry to adjust their supply lines to alternate countries. In a statement accompanying the tariff announcement Trump said ‘We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly’ adding ‘But, so far, China has been unwilling to change its practices’. There was also a warning from the White House to the Chinese government’s response, threatening ‘Further, if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately USD267bn of additional imports’.
Hours after the Trump announcement the Chinese Ministry of Commerce vowed to retaliate against the new tariffs although there was no indication on how or when any action would be taken. The Ministry puts the blame for the escalation to the current row firmly at the door of the US administration, stating ‘The U.S. insists on increasing tariffs, which brings new uncertainty to the consultations between the two sides. It is hoped that the U.S. will recognize the possible negative consequences of such actions and take convincing means to correct them in a timely manner’. In addition to this, the Chinese Foreign Ministry has claimed that the US has not been ‘sincere’ in its recent talk to try to resolve the ongoing issues. This came after Larry Kudlow, Trump's economic adviser said they are still willing to talk ‘We are ready to negotiate and talk with China anytime they are ready for serious and substantive negotiations’ he said.
US tech giant Apple will not have tariffs imposed in this latest round of the ongoing trade war after warning that a wide range of its products would be hit. Bluetooth devices and smart watches being some of the items removed from the previous tariff list. In total there was 300 items excluded from the original tariff list of 6,000, with other items including children’s car seats, bicycle helmets and some industrial chemicals becoming exempt.