China Trade War Could Hit Global Economic Recovery

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Although planned United States soybean shipments so far remain unaffected by China's retaliatory tariffs, the crop's price has dropped as much as 5.3 per cent on the Chicago Board of Trade - its sharpest decline since July 2016.

The United States on Tuesday said it would impose 25 percent duties on $50 billion of imports from China, and China quickly retaliated by listing $50 billion of products that it could hit with its own 25 percent tariffs.

Illicit activities such as counterfeit goods, pirated software, theft of trade secrets and copyright and trademark infringement can not be precisely measured.

"Example, when we are down $100bn with a certain country and they get cute, don't trade anymore - we win big". "But this is certainly how they might start". China's tariffs, meanwhile, will be imposed when US tariffs take effect: "The date of implementation will depend on when the USA government imposes the tariffs on Chinese products", the Chinese Ministry of Finance said in its announcement.

If the conflict were to escalate and Beijing increased punitive duties on USA soybeans to 30 per cent, United States exports to China could plunge by as much as 70 per cent, the council predicted.

Agriculture: With Chinese tariffs targeting US agricultural products like apples and soybeans, Canadian producers are concerned that USA output will start flooding north in search of markets.

- "We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion".

Global trade tensions continue to escalate, with some fearing a trade war between the USA and China. The duties would mostly steer clear of the billions of dollars of consumer goods that the USA imports from China, such as iPhones, toys, and shoes. By the end of the trading day, the Dow was up 231 points, or around 1 percent. The Nasdaq composite rose 100.83 points, or 1.5 percent, to 7,042.11. The Russell 2000 index of smaller-company stocks gained 1.3 percent to 1,531.66.

In issuing its hit list, Beijing blamed the USA for picking a fight.

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"We maintain our China GDP growth forecast of 6.5 percent given strong Q1 growth and uncertainty on USA remedies", said the report. "Our action is restrained".

The proximate cause for this tit-for-tat goes back to early March when U.S. President Donald Trump announced tariffs of 25% and 10% on imports of steel and aluminium, respectively, using "national security" provisions of U.S. trade law. USTR's proposed list will be open for public comment during the review process, which won't be completed until May. China said it too is moving slowly.

Mr Trump has also threatened to levy a tax on European Union cars if the bloc does not remove tariffs and trade barriers on various goods. "There are carrots and sticks in life". According to the White House, the measure is aimed at curbing "unfair" trade practices. "They say the Trump's strategy could falter in the face of a stoic China".

"Farmers and ranchers shouldn't be expected to bear the brunt of retaliation for the entire country".

The more bullish outlook for stocks came on the heels of another see-saw session on Wall Street that saw equities rally impressively into the close. "Today shows that's exactly what happened".

Ford said it encouraged both governments to work together to resolve issues.

The additional tariffs initially applied to 128 products but the list has since been expanded to include an additional 106 products. Trump missed a great chance when he walked away from the Trans-Pacific Partnership, a 12-nation deal that would have slashed tariffs throughout the region - and put strong pressure on Beijing, which chose not to participate, to change its ways.

China on Wednesday issued a $50 billion list of U.S. goods, including soybeans and small aircraft, for possible tariff hikes in an escalating and potentially damaging technology dispute with Washington.

This article is based in part on wire service reports.