Escalating trade war with China could affect Minnesotans

Escalating trade war with China could affect Minnesotans

By next week, the world's two largest economies could be on track to impose levies on the $635 billion worth of goods traded annually between them. China matched that, too.

WASHINGTON-President Donald Trump warned of further retaliation against China and accused Beijing of seeking to influence November midterms by targeting USA farmers and industrial workers in the escalating trade war. But this time, China can not match them all - and that crystallizes a growing problem for Beijing.

China Tuesday announced tariffs on U.S. goods worth $60 billion in retaliation for President Donald Trump's decision to slap duties on $200 billion in Chinese products next week.

"What China does not understand is that these people are great patriots and fully understand that.China has been taking advantage of the United States on Trade for many years", he tweeted.

"As president, it is my duty to protect the interests of working men and women, farmers, ranchers, businesses, and our country itself", Trump said in a statement. They have high expectations that Trump will fail in the elections.

Beijing and Washington have already imposed punitive tariffs on $50 billion worth of each other's products.

So far, the US-China trade talks have led nowhere and neither side appears willing to back down.

The new tariffs could also sidetrack trade talks in Washington, D.C., set for next week between US and Chinese officials.

Issa said Li's comments on protecting intellectual property rights and treating foreign companies equally were "encouraging but not new".

"But at this time, everything the United States does does not give the impression of sincerity or goodwill", he said. Some hard-liners want a more aggressive stance. American companies say regulators are already starting to disrupt their operations. But Chinese trade experts dismiss that idea as impractical and not the government's position. But considering the full menu of how the Chinese could hit back, the way they're actually hitting back is rather underwhelming.

"Contrary to views in Washington, China can - and will - dig its heels in and we are not optimistic about the prospect for a resolution in the short term", said Zarit of the American Chamber of Commerce.

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That approach would have recognized a potentially expensive new reality for Beijing: The tariffs may be here to stay.

While Chinese manufacturing greatly depends on US technology, China is pulling ahead in some areas, including electric cars and artificial intelligence. However, with the trade war escalating, China might take a more aggressive stance on helping Iran avoid the impact of sanctions. Even if Trump leaves office in two years, there is little guarantee that his China trade policies will be changed.

"If any of that goes on we're going to kick in $267 billion dollars", he said.

Chinese Premier Li Keqiang speaks during a meeting with ExxonMobil chairman and CEO Darren Woods (not pictured) at the Zhongnanhai Leadership Compound in Beijing on September 7, 2018. Trade wars aren't fun for anyone.

China's other options are limited.

China would be willing to suffer a lot so that it no longer depends on the US, but whether that could be seen as a loss or a long-term win is not so clear.

The Chinese premier, who is China's second-in-command, explained his country did not expect to make any major changes to its macroeconomic policy. Meanwhile, about half of registered voters said duties will do more to raise the costs of goods or hurt the economy.

China said Tuesday it has " no choice " but to retaliate, according to a statement released Tuesday by its Commerce Ministry. American farmers and business owners, meanwhile, fear they will lose access to the lucrative Chinese market: a middle class of consumers larger than the entire US population.

China has, unsurprisingly, returned fire with its own tariffs on $60bn of American goods coming into the Middle Kingdom.

China's yuan, also known as the renminbi, has steadily depreciated this year, causing Trump to accuse Beijing of deliberately manipulating the currency to offset the new tariffs.