The United States and China started a potential trade war on Friday. Both countries imposed taxes on $34 billion worth of products. Neither the U.S. nor China shows signs of interest in starting talks aimed at making things better.
The Biggest Trade War
The tariffs the U.S. is imposing on Chinese goods took effect on Friday. China immediately retaliated and imposed the same amount of tax on the U.S. Beijing accused the U.S. of starting the biggest trade war in the history.
This fight between the two largest economies in the world is escalating. Scott Kennedy is the Head of China studies at the Center for Strategic and International Studies in Washington. He said it would take political and economic paint to get these two countries to negotiate.
President Donald Trump already threatened China with more taxes. He said that the U.S. could target more than $500 billion worth of Chinese products. The total amount that China imported into the U.S. in the last year is roughly $500 billion.
The Trade War Will Harm the U.S.?
Kennedy said that there’s a question if the Chinese economy will start to wobble and how the U.S. voters are going to react.
Erin Ennis is the Senior Vice President of the U.S. China Business Council. He said there is one potential danger. He stated that the two sides probably don’t have good strategies to continue negotiations. Ennis added that U.S. companies in China agree with some of Trump’s statements. But they don’t see how these taxes will push Beijing into submission.
Some of the Republicans in Congress criticized Trump’s actions.
Jerry Moran is one of the senators from Kansas. He said that these taxes will hurt ranchers, airplane manufacturers, farmers, and American consumers. He thinks that the U.S. should isolate China instead of starting a huge trade war.
China was forced to retaliate, according to China’s commerce ministry. Their actions will now subject American exports of lobsters, cars, and soybeans to 25% taxes.
It’s difficult to see how the trade war will end. President Trump is a master business man. He no doubt has a strategy to win the long game. But many wonder how much his decisions hurt American businesses in the short term.