Updates on the U.S.-China Trade Conflict
On Monday, June 18, President Donald Trump announced that he was prepared to impose tariffs on as much as $450 billion of Chinese products if the country kept retaliating with its own tariffs.
This action stemmed from President Trump’s Friday statement that the administration would be following through with the plan to place tariffs on $50 billion worth of Chinese products on July 6, to which Beijing responded swiftly, saying that the United States had begun a “trade war” and that China would place tariffs on $50 billion of American goods. China’s tariffs would go after cars, seafood, and agricultural goods, along with other products.
In turn, President Trump said on Monday that the administration was ready to impose tariffs on another $200 billion of Chinese products, and another $200 billion if China retaliated. The amount of potential tariffs cited by President Trump now totals nearly as much as the total value of all the products shipped to America by China in 2017, which amounted to $505.6 billion.
“Further action must be taken to encourage China to change its unfair practices, open its market to United States goods, and accept a more balanced trade relationship with the United States,” said President Trump.
Markets sank on Tuesday, with the Dow Jones index, the Nasdaq composite, and the Standard & Poor’s 600-stock index all falling, along with markets in Hong Kong, Frankfurt, London, Tokyo, Paris, and mainland China lower. Shares of Caterpillar and Boeing — both top U.S. exporters to China — fell dramatically on Tuesday, as did soybean futures.
Below are some of the top U.S. companies with trade ties to China.
- John Deere: 8%
- Caterpillar: 9%
- Boeing: 11%
- Nike: 12%
- 3M Co.: 13%
- Tiffany & Co.: 13%
- Starbucks: 15%
- McDonald’s: 15%
Many companies are weighing in on the tariffs. Apple’s CEO Tim Cook, for instance, said earlier in the month that he didn’t expect iPhones to be subject to the tariffs and didn’t expect a trade war to ensue. On Monday, amid swirling rumors, President Trump said that iPhones would not be included.
On Tuesday morning, White House trade advisor Peter Navarro said that the United States has given China several chances to negotiate and change policies that have caused millions of U.S. job losses:. He also cited China’s plans to build up cutting-edge, advanced industries such as robotics and aerospace, saying that the country would not be permitted to dominate these technologies, which would become critical components of job growth and industry development in America.
Navarro added that China has been engaging in several unfair practices, including cybertheft, export controls evasion, and “information harvesting,” gleaning technological secrets that would help China pull ahead of the United States in these critical sectors.
Analysts and experts — and those in the affected industries — continue to monitor the situation, with many concerned that an all-out trade war may be looming. Experts are noting that China may face difficulties in retaliating, as the country exports much more to the United States than the United States ships to China. Many analysts also say they are unsure which nation may back down first, noting that both America and China are likely to be able to hold up against the early stages of the tariffs.