China’s 84% tariff in retaliation against US President Donald Trump’s levy hike on Chinese imports came into effect on Thursday amid an escalating trade war between the two global economies.
In a series of tit-for-tat raises, China announced reciprocal tariffs of 34% in response to Trump’s first round of tariffs, rejecting Trump's warning to withdraw them or he would raise theirs again.
With Trump raising tariffs to 104% against Chinese imports, Beijing responded with an 84% duty on US products.
Trump further raised tariffs to 125% on Wednesday.
Beijing has also put 18 US companies on trade restriction lists, along with other countermeasures, as there is no sign of an immediate pause in the simmering trade war between the two countries.
In an apparent bid to mitigate the US tariff woes, China appears to be approaching other nations to shore up trading agreements.
Nikkei, ASX and S&P all see a surge following the US President's announcement of a 90-day pause on tariffs.
Beijing-Brussels rapprochement
President Xi Jinping is set to embark on his visit to Southeast Asian nations, including Malaysia, next week.
China and the EU also vowed to jointly uphold the multilateral trading system with the World Trade Organization (WTO) at its core, according to Beijing's Commerce Ministry.
The agreement was reached during a virtual meeting between China's Commerce Minister Wang Wentao and European Commissioner for Trade and Economic Security Maros Sefcovic, the Chinese state-run Xinhua news agency reported on Thursday.
The two discussed various issues, including enhancing China-EU economic and trade cooperation and responses to the US imposition of so-called "reciprocal tariffs."
Sefcovic said the US tariffs have severely impacted international trade, and the EU is willing to work with other WTO members, including China, to ensure the normal operation of international trade, according to Xinhua.
The World Trade Organization says dividing global economy into two blocks could lead to 7% reduction in global GDP, warning that the least developed countries will be affected the most.
