European exporters in China shift trade to avoid US tariffs

US fires next shot in China trade war

Trump preparing additional tariffs on $200B in Chinese goods

The move is in response to what the Trump administration says is China's unfair trade practices, and comes after both nations already announced tariffs on US$50 billion of each other's products.

The US Trade Representative office will hold hearings on the targeted products and it's expected it will take about two months to finalize the list, at which point Mr Trump would decide whether to go ahead with the tariffs. The move escalates the trade war between the world's two largest economies.

The Trump administration on July 6 imposed 25 per cent duties on US$34 billion in Chinese imports, the first time the president has implemented tariffs directly on Beijing after threatening to do so for months.

China's retaliation to those measures was "without any global legal basis or justification", Lighthizer said Tuesday.

The tariff list could be released as soon as Tuesday, and likely this week, the report said. However, because China exports more to the United States than it imports there are limits on the amount of tariffs Beijing can impose on American goods. "We can not turn a blind eye to China's mercantilist trade practices, but this action falls short of a strategy that will give the administration negotiating leverage with China while maintaining the long-term health and prosperity of the American economy". Rather than address our legitimate concerns, China has begun to retaliate against US products.

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Chinese tariffs have already taken a toll on USA exports such as soybeans, which raises questions about the possible political repercussions President Trump could face from farmers who supported him in the 2016 election.

More than 6,031 product lines are affected by the proposed tariffs, including seafood, fruits and vegetables, grains, tobacco, vehicle rearview mirrors and burglar alarms.

"This is where a painful situation gets more painful", said Phil Levy, a former White House economist in the George W. Bush administration. That's why Trump can slap tariffs on them just because he feels like it.

The official said the decision was not final and that the list of Chinese goods would not become final until after the public had a chance to comment. "Unfortunately, China has not changed its behavior - behavior that puts the future of the US economy at risk". "Moreover, they will blame any economic troubles on Trump and the United States".

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