China retaliates, hikes tariff on USD 60 billion of US products

Updated: May 14, 2019, 11:07 IST | Agencies

The markets in the United States and Europe react badly to the move, which the Chinese Ministry of Finance says is 'a response to unilateralism and trade protectionism'

China retaliates, hikes tariff on USD 60 billion of US products
Xi Jinping

Beijing/Washington: China on Monday retaliated against the US imposing additional tariffs and vowed that it will "never surrender to external pressure" after President Donald Trump warned his Chinese counterpart Xi Jinping that Beijing "will be hurt very badly" if he did not strike a deal with America.

As the two trading giants and top economies were locked in a bruising trade war, Trump on Monday warned the Communist giant not to impose retaliatory tariffs on American products.

After the near collapse of trade talks with China last week, Trump on Friday imposed punitive duties on USD 200 billion worth of Chinese imports, raising them to 25 per cent from 10 per cent, and asked for a similar increase on tariff on the rest of the Chinese import of over USD 300 billion.

In the latest escalation of the trade war, the Chinese Ministry of Finance said tariffs on $60 billions of US exports to China would rise by "25, 20 and 10 per cent" respectively. Products that were taxed at five per cent would not be affected.

The ministry said China's move was "a response to unilateralism and trade protectionism." "China hopes the US will return to the right track of bilateral trade negotiations, work together with China and meet it halfway to reach a mutually beneficial and win-win agreement on the basis of mutual respect and equality," the ministry said.

US markets reacted badly to the move. Markets in Europe were also depressed by the latest round of tit-for-tat tariffs, with London's FTSE 100 down about 0.5 per cent, while the main indexes in Frankfurt and Paris were more than 1 per cent lower.

25%
Maximum tariff imposed by China on US goods

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