‘Totally unacceptable’: China promises retaliation over latest U.S. tariff threats

The Associated Press technology and worries that plans for state-led development of Chinese champions in robots and other fields might erode American industrial leadership.

The U.S. Trade Representative announced Tuesday a possible second round of tariff hikes targeting a $200 billion list of Chinese goods ranging from burglar alarms to mackerel. That came four days after Washington added 25 percent duties on $34 billion of Chinese goods and Beijing responded by increasing its own taxes on the same amount of American imports.

The USTR said the latest action was in response to Beijing’s failure to change its policies and its retaliatory duties. President Donald Trump has threatened higher tariffs on more than $500 billion of goods, or nearly all of China’s annual exports to the United States.

The USTR will accept public comments and hold hearings before deciding, according to a senior U.S. official who briefed reporters on condition of anonymity.

The first U.S. tariff list focused on Chinese industrial products. The latest list hits items that U.S. households buy, like electric lamps, apple juice and fish sticks.

Beijing’s lopsided trade balance with the United States means it will quickly run out of imports for retaliation. China imported U.S. goods worth $130 billion last year and Friday’s tariff hike hit $34 billion of that, with another $16 billion cited for a possible increase.

China “cannot match fresh U.S. tariffs,” Vishnu Varathan of Mizuho Bank said in a report.

Instead, its heavily regulated economy gives Beijing tools to disrupt operations for American automakers, restaurant chains and other companies that are looking to China to drive revenue growth. Regulators can deny or cancel licenses or tie up companies by launching tax, environmental or antimonopoly investigations.

Companies are watching U.S. chipmaker Qualcomm Inc., which has waited for months for Chinese regulators to decide whether to allow its proposed $44 billion acquisition of NXP Semiconductors. All other major governments have approved.

The impact of the conflict already is spreading.

The European Union Chamber of Commerce in China said this week its member companies are rearranging their trade shipments to ensure any bound for the United States don’t pass through China.

Members of Congress are increasingly questioning Trump’s aggressive trade policies, warning that tariffs on imports raise prices for consumers and expose U.S. farmers and manufacturers to retaliation abroad from other countries.