Trump slaps tariffs on Chinese imports; Beijing hits back

China retaliated with reciprocal tariffs on $3 billion of imports from the U.S. immediately as US President Donald Trump slapped sanctions for the “theft” of intellectual property.

WASHINGTON (TIP): US President Donald Trump on Thursday, March 22, imposed tariffs on Chinese imports to punish the country for its “unfair” seizure of American intellectual property, a move that could escalate the already tense trade relations between the world’s two biggest economies.

Trump directed the US trade representative to level tariffs on about $60 billion of Chinese imports after a seven-month probe into the intellectual property theft, which has been a longstanding point of contention in US-China trade relations.

“We have a tremendous intellectual property theft problem. It’s going to make us a much stronger, much richer nation,” Trump said. “This has been long in the making,” Trump told reporters at the ceremony in the White House while signing his memorandums targeting China’s economic actions.

Trump’s action comes a day after US Trade Representative concluded its Special 301 investigation against China and presented its report to him. The USTR report concluded that China uses foreign ownership restrictions, including joint venture requirements, equity limitations and other investment restrictions to require or pressure technology transfer from US companies to Chinese entities.

“This requires taking effective action to confront China over its state-led efforts to force, strong-arm, and even steal US technology and intellectual property,” said US Trade Representative Robert Lighthizer.

Trump said his Section 301 trade action could be about $60 billion. He instructed USTR to publish a proposed list of products and any tariff increases within 15 days and to pursue dispute settlement in the World Trade Organization to address China’s discriminatory technology licensing practices.

He also has directed the Treasury Secretary to address concerns about investment in the US directed or facilitated by China in industries or technologies deemed important to the country. Trump said America’s trade deficit with China was a whopping $504 billion per annum.

China which had earlier said it will not sit back idly in case US imposed tariffs, in a quick counter action announced plans for imposing reciprocal tariffs on $3 billion of imports from the U.S. including products from steel to pork.

Bloomberg, in a late evening breaking news, March 22 saw the Chinese retaliation as “the arrival of a trade war” between the US and China.

In a statement Friday, March 23, hours after Trump instructed U.S. Trade Representative Robert Lighthizer to slap tariffs on at least $50 billion in Chinese imports, China’s Commerce Ministry said it plans a 25 percent tariff on U.S. pork imports and recycled aluminum, and 15 percent tariffs on American steel pipes, fruit and wine.

China will also pursue legal action against the U.S. at the World Trade Organization, the statement said, and called for dialogue to resolve the dispute.

Policy makers across the world are warning of a brewing trade war that could undermine the broadest global recovery in years. Meanwhile, business groups representing companies ranging from Walmart Inc. to Amazon.com Inc. are warning U.S. tariffs could raise prices for consumers and sideswipe stock prices.

(With inputs from PTI)