Team Trump and China slapped tit-for-tat tariffs on $34 billion worth of United States and Chinese imports on Friday, with Beijing accusing Washington of triggering the "largest-scale trade war" as the world's two biggest economies escalated their battle.
The U.S.is implementing tariffs in response to China's unfair business practices related to the forced transfer of American technology and intellectual property, the Central Bank said, adding that this action has devalued major Asian currencies, heightened market volatility and could drag other economies into a broader trade dispute.
Chinese goods being hit by USA levies include cars, computer disk drives, pump and valve parts and LEDs. "So we have 50 plus 200 plus nearly 300", Trump said, per reports from CNBC and Reuters.
A spokesperson at China's Ministry of Commerce said Friday that while the Asian giant had refused to "fire the first shot", it was being forced to respond after the USA had "launched the largest trade war in economic history".
The spectre of a full-blown trade war also risks sinking China's markets deeper into bear territory.
But after the US hiked tariffs on an initial batch of $34 billion of Chinese goods on Friday, China retaliated with matching tariffs on an equal amount of USA imports - including soybeans.
Trump confirmed that the United States would begin collecting tariffs on $34 billion in Chinese goods at 12:01 a.m. Washington D.C. time (0401 GMT) on Friday and warned that subsequent rounds could see tariffs on more than $500 billion of goods, or roughly the total amount that the United States imported from China a year ago. Eastern time on $34 billion worth of Chinese imports, a first step in what could become an accelerating series of tariffs.
China is aiming to boost domestic production of soybeans by calling on its vast army of farmers to expand soybean acreage and offering greater subsidies to growers such as Rao.
The US had announced imposition of 25 and 10 percent tariffs on steel and aluminium respectively on three of its biggest trading partners - Canada, Mexico and the European Union on May 31.
Whiskey, along with soybeans, pork and cheese, is among the products on which China has slapped retaliatory tariffs.
The tit-for-tat battle no doubt reflects U.S. President Donald Trump's "America first" policy.
There was no sign of renewed negotiations between U.S. and Chinese officials before Friday, business sources in Washington and Beijing said.
Chinese Commerce Ministry spokesman Gao Feng said the proposed USA tariffs would hit many American and foreign companies operating in China and disrupt their supplies of components and assembly work.
Months of dialogue between the two economic superpowers appeared to have failed, with Trump warning just hours before the tariffs came into effect that Washington was ready to impose duties on hundreds of billions more in Chinese imports.
"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.
Kennedy say he thinks the Trump administration's enthusiasm for the conflict "will erode as the economic pain and political fallout from a trade war begin to take hold".
Terming the manufacturing of flags for Trump's 2020 bid as "completely normal", he said, "That is trade".
These initial tariffs are unlikely to inflict serious harm to the world's two biggest economies.
"Around 59 percent of products worth US$34 billion subject to additional tariffs are made by foreign firms in China, with American firms making up a considerable part", Gao said. "That's the nature of trade wars as well, and while no one is likely to win this confrontation, both sides could certainly lose". "We will work with other countries around the world to jointly safeguard free trade and the multilateral system".
"Thirty-four, 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?"
USA trade data released Friday showed exports hit a record, as importers bumped up purchases, particularly of tariff-targeted United States soy beans, to build up supplies before the new duties hit.