BEIJING (AP) The Chinese government vowed today to take firm and forceful measures against U.S. threats to expand tariff hikes to thousands of products like fish sticks, apples and French doors as their trade dispute escalates.
China gave no details but earlier threatened comprehensive measures if Washington took more action. That prompted fears Beijing, running out of imports for retaliation due to its lopsided trade balance with the U.S., might try to disrupt operations of American automakers, retailers and others that see China as a key market.
The spiraling conflict over Chinese technology policy threatens to chill global economic growth. It stems from Washingtons complaint that Beijing steals or pressures companies to hand over technology and worries that plans for state-led development of Chinese champions in robots and other fields might erode American industrial leadership.
A possible second round of tariff hikes announced Tuesday by the U.S. Trade Representative targets a $200 billion list of Chinese goods. That came four days after Washington added 25 percent duties on $34 billion worth of Chinese goods and Beijing responded by increasing taxes on the same amount of American imports.
The abrupt escalation is totally unacceptable, said a Commerce Ministry statement. It said Beijing would take unspecified necessary countermeasures to protect its core interests.
Asked what Beijing would do, foreign ministry spokeswoman Hua Chunying gave no details but said, We will take firm and forceful measures.
The USTR said it was responding to Beijings decision to retaliate instead of changing its policies. President Donald Trump has threatened higher tariffs on more than $500 billion of goods, or nearly all of Chinas annual exports to the United States.
The USTR will accept public comments and hold hearings Aug. 20-23 before reaching a decision after Aug. 31, according to a senior U.S. official who briefed reporters on condition of anonymity.
The first U.S. tariff list focused on Chinese industrial products, an attempt to reduce the direct impact on American consumers.
The new list includes vacuum cleaners, furniture, auto and bicycle parts, French doors and plywood. It left untouched U.S.-branded smartphones and laptop computers.
That will hit the Chinese export sector hard, said Rajiv Biswas of IHS Markit in a report.
Chinas imports of U.S. goods are so small that Beijing cannot match fresh U.S. tariffs, said Vishnu Varathan of Mizuho Bank in a report.
China bought $130 billion of U.S. goods last year. Both governments have raised tariffs on $34 billion worth of each others goods and already said they are considering additional charges on another $16 billion. That would leave China only $80 billion for further retaliation.
Instead, its heavily regulated economy gives Beijing tools to disrupt operations for American companies. Regulators can deny or cancel licenses or tie up companies by launching tax, environmental or anti-monopoly investigations.
