Within a week after announcing a solution to the trade stalemate with China, the US government Tuesday slapped a 25% tariff on the import of select tech products from China, reigniting the trade war fears and damping the hopes of a lasting solution to the standoff between the countries.
In what could be the sign of a long-term hostility with Beijing on the trade front, Washington is preparing a list of Chinese items worth $50 billion that will be brought under the new tariff. Going ahead, China will also face investment restrictions and curbs of export of industrial technology in the coming weeks.
Tightening its stance further, the federal government also vowed to go ahead with its multiple lawsuits against China over infringement of intellectual property rights.
Interestingly, the unfortunate turn of events coincides with a spat between representatives of the world’s largest economies over technology transfer at the World Trade Organization (WTO) meeting. It started after China responded harshly to the US claims that the former ‘stole’ its business ideas. White House has long been accusing China of coaxing US firms into sharing vital technology before giving entry to its market.
Snubbing Washington’s charges as a claim laced with ‘presumption of guilt’, Chinese ambassador Zhang Xiangchen said at the WTO meeting, “There is no forced technology transfer in China.”
Washington is preparing a list of Chinese items worth $50 billion to be brought under the new tariff
China’s recent promise to buy more agriculture and energy products from the US and the US Commerce Department’s positive gesture waiving sanctions against Chinese telecom company ZTE were widely perceived as a major boost to the faltering trade relations between the countries. However, there was an air of pessimism in the market after Trump issued a statement last week stressing the need to adopt a “different structure” for all negotiations between China and the US.
A re-escalation of the conflict was widely expected after certain key issues were not discussed at the landmark meeting between the US and China earlier this month. After the meeting, Trump had earned the ire of the pro-protectionist group for diluting his ‘America First’ campaign by relaxing the China policy.
It all started when the Trump administration imposed heavy tariffs on all import of steel and aluminum two months ago, apparently targeting China. An economic warfare erupted between the countries when China retaliated by imposing tariffs on the import of 128 US product categories, triggering fears of a trade war.
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