Friday, August 2, 2019

Donald Trump's $300 Billion China Tariff Threat

Donald Trump (left) pulled off a surprise on Thursday – when he announced on Twitter – his decision to escalate the trade war with the imposition of a 10 percent tariff on an additional $300 billion worth of Chinese imports as of September 01. 

This is a significant escalation in a trade war that has dragged on for more than a year. 

This comes on top of the 25 percent levy that Trump has already imposed on $250 billion worth of Chinese imports. 

Whilst, Trump described the 10 percent tariff as “small” – nonetheless, it will further compound economic damage from his long-running trade war. Unlike his previous tariffs, this round would hit a broad swath of consumer products and could dampen consumer spending at time when economic growth has already begun to cool. 

And, of course, the new tariffs could be raised even higher, perhaps to 25 percent or more – if, down the road, things take a further turn for the worse. 

Neil Wilson, chief analyst at markets.com in London, UK said: “The sharp shooters have given way to the heavy artillery. The trade war just got very hot, just as we thought things were improving”. 

Trump's tariffs now cover virtually all of US imports from China.

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