US, China fire first shots in 'largest trade war in economic history'

US, China fire first shots in 'largest trade war in economic history'

American officials worry US industrial leadership will be eroded by Chinese plans to create tech champions in fields including robotics, biotech and artificial intelligence.

Today's tariffs could just be the opening skirmishes in the trade war, as US President Donald Trump has vowed to hit as much as US$450 billion in Chinese goods, the vast majority of imports.

Faced with President Donald Trump's threat to target United States imports of cars from Europe, German and French government officials plan to meet next week in Paris to coordinate strategy.

Li Daxiao, analyst at Yingda Securities, said news of the tariffs was already priced into the market, "therefore investors are not in as much of a panic as before".

China's counterplan calls for $34 billion in duties on such American products as beef, chicken, pork and soybeans - as well as electric and sport-utility vehicles.

China is targeting agriculture products and mechanical parts for the energy sector, whereas the United States is aiming its tariffs at a large number of industrial products and resources.

For the past three months, the "war of words" between the world's two largest economies has gathered pace after the White House pledged to cut the ballooning United States trade deficit with China.

Companies worry the spiraling dispute could chill global economic growth, but Asian financial markets took Friday's developments in stride. The Shanghai Composite index fell 1.1%, after reaching more than a two-year low this week.

Throughout the escalating conflict, China has sought to take the high road, positioning itself as a champion of free trade, but state media ramped-up criticism of Trump on Friday.

Beijing has announced changes this year including easing limits on foreign ownership in insurance and some other fields.

Who are the 4 Supreme Court contenders Trump has met so far?
Schumer said that while Democrats don't control the Senate - Republicans have a 51-49 edge - most senators back abortion rights. Sources say Collins specifically opposes federal Appeals Court Judge William Pryor, who once called Roe "an abomination".

Hours before Washington's deadline for the tariffs to take effect, US President Donald Trump upped the ante, warning that the United States may ultimately target over $500 billion worth of Chinese goods, or roughly the total amount of US imports from China previous year.

First "34 (billion dollars), and then you have another 16 in two weeks and then as you know we have $200 billion in abeyance and then after the $200 billion we have $300 billion in abeyance. Ok?"

That would bring the total of targeted Chinese goods to $550 billion - more than the $506 billion in goods that China shipped to the United States past year. But rules on auto manufacturing, pharmaceuticals and other industries require companies to operate through state-owned Chinese partners and share know-how with potential competitors or teach them how to develop their own. Requests for comment went unanswered at the U.S. Treasury, USTR and the U.S. Commerce Department.

By itself, Mr. Trump's opening salvo, a 25 percent tariff on 818 Chinese imports, worth $34 billion a year, amounts to a rounding error as compared with the overall size of the USA and Chinese economies.

"In effect, the Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China", the state-run China Daily newspaper said in an English language editorial on Friday.

And enduring the pinch isn't going to pay off. Protectionism has historically proven to be destructive for the global economy and won't achieve what the Trump administration is trying to accomplish, said Hsu.

"The key is whether there will be more - a second round of revenge and retaliation and a third round", said Shi Yinhong, a professor of global relations at Renmin University in Beijing.

The American Chamber of Commerce in China appealed to both sides to negotiate.

Al Jazeera's McBride said that the looming trade war has not played well "to the general business sentiment". It said US companies want fairer treatment but will be hurt by US-Chinese tensions.

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