US hikes tariffs on Chinese goods, China says to strike back

UNITED STATES : President Donald Trump escalated his trade war with China on Friday morning, raising tariffs on $200 billion worth of Chinese goods and taking steps to tax nearly all of China’s imports as punishment for what he said was Beijing’s attempt to “renegotiate” a trade deal.

Trump’s decision to proceed with the tariff increase came after a pivotal round of trade talks in Washington on Thursday night failed to produce an agreement to forestall the higher levies. The White House said talks would resume Friday but it remains uncertain whether the two sides can bridge the differences that have arisen over the past week.

In his comments at the White House on Thursday afternoon, Trump vacillated between threatening China and suggesting a deal could still happen. The president said he had received a “beautiful letter” from President Xi Jinping of China and would probably speak to him by phone but said he was more than happy to keep hitting Beijing with tariffs.“I have no idea what’s going to happen,” he said. “They’ll see what they can do, but our alternative is, is an excellent one,” Trump added, noting that U.S. tariffs on $250 billion worth of Chinese products were bringing “billions” in to the U.S. government.

In a statement Friday, China’s Ministry of Commerce said that the government “deeply regrets that it will have to take necessary countermeasures.” It didn’t specify what those countermeasures might be.

“It is hoped that the U.S. and Chinese sides will meet each other halfway and work together” to resolve their dispute, the statement added.

The renewed brinkmanship has plunged the world’s two largest economies back into a trade war that had seemed on the cusp of ending. The United States and China were nearing a trade deal that would lift tariffs, open the Chinese market to U.S. companies and strengthen China’s intellectual property protections. But discussions fell apart last weekend, when China called for substantial changes to the negotiating text that both countries had been using as a blueprint for a sweeping trade pact.