U.S. ups ante with China to $200 billion

WASHINGTON • President Donald Trump directed the U.S. Trade Representative to prepare new tariffs on $200 billion in Chinese imports Monday as the two nations moved closer to a potential trade war.

The tariffs, which Trump wants set at a 10 per cent rate, would be the latest round of punitive measures in an escalating dispute over the large trade imbalance between the two countries. Trump recently ordered tariffs on $50 billion in Chinese goods in retaliation for what the U.S. said is intellectual properly theft. The tariffs were quickly matched by China on U.S. exports. “China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology,” Trump said Monday announcing the new action. “Rather than altering those practices, it is now threatening United States companies, workers, and farmers who have done nothing wrong.” Trump added: “These tariffs will go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced.”

Trump said that if China responds to this fresh round of tariffs, then he will move to counter “by pursuing additional tariffs on another $200 billion of goods.” Trump’s comments come hours after the top U.S. diplomat accused China of engaging in “predatory economics 101” and an “unprecedented level of larceny” of intellectual property. Secretary of State Mike Pompeo made the remarks at the Detroit Economic Club as global markets reacted to trade tensions between the U.S. and China. Both nations started putting trade tariffs in motion that are set to take effect July 6. He said China’s recent claims of “openness and globalization” are “a joke.” He added that China is a “predatory economic government” that is “long overdue in being tackled,” matters that include IP theft and Chinese steel and aluminum flooding the U.S. market. “Everyone knows ... China is the main perpetrator,” he said. “It’s an unprecedented level of larceny.”

“This is predatory economics 101,” he said later. The Chinese Embassy in Washington did not immediately respond to a request for comment.

Pompeo raised the trade issue directly with China last week, when he met in Beijing with President Xi Jinping.

“I reminded him that’s not fair competition,” Pompeo said.

Wall Street has viewed the escalating trade tensions with wariness, fearful they could strangle the economic growth achieved during Trump’s watch.