US-China trade war heightens as new tariffs on $260bn goods hit

24 September 2018 06:42 Source:ICIS News

SINGAPORE (ICIS)--The US-China trade war escalated as a third round of tariffs involving $260bn worth of goods was implemented on Monday, concerns for which have been rattling Asia’s equities and currency markets.

The US’ 10% tariffs on $200bn Chinese goods and China’s retaliatory 5-10% tariffs on $60bn US goods took effect at 04:01 GMT, barely three months since the trade war between the world’s two biggest economies officially started.

The US will raise the tariff rate on the products covered by the latest round to  25% by 1 January 2019.

In the first two rounds – on 6 July and 23 August – 25% tariffs were slapped on a total of $50bn worth of goods on each side.

The final list of products in the third round of US tariffs, however, removed a total of 142 chemical and plastics products, compared with the preliminary list, according to the American Chemistry Council (ACC).

In a statement dated 18 September, the Office of the US Trade Representative (USTR) said that among the products removed from its tariff list are “certain consumer electronics products such as smart watches and Bluetooth devices; certain chemical inputs for manufactured goods, textiles and agriculture; certain health and safety products such as bicycle helmets, and child safety furniture such as car seats and playpens”.

The US is threatening to impose tariffs on a further $267bn worth of Chinese goods, covering all of its imports from the Asian economic giant.

In 2017, China’s total imports from the US stood at $130bn, while US’ imports of Chinese goods and services totaled around $500bn, based on US data.

(Top image: Shutterstock)

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By Pearl Bantillo