‘Totally unacceptable’: Beijing vows retaliation if USA taxes $200bn of Chinese goods

‘Totally unacceptable’: Beijing vows retaliation if USA taxes $200bn of Chinese goods

Research from Capital Economics (CE) shows sales from US-owned affiliates total $US350 billion - similar in size to the United States trade deficit.

The list is subject to two months of finalization and input before possible implementation by President Donald Trump.

Trump has been considering tariffs against China since his officials concluded in March that Beijing violates US intellectual-property rights, such as by forcing American firms to hand over technology. As Trump put it back in June (via Twitter): "China apparently has no intention of changing its unfair practices related to the acquisition of American intellectual property and technology".

"The United States has unveiled the list of tariffs in an escalating manner".

Trump has said continuously that China has taken advantage of the United States economy, and he has vowed to hit almost all the country's products with tariffs, as much as $450bn. It's a potential outcome of a new round of tariffs the Trump administration is proposing to slap on Chinese imports as soon as September.

China hasn't yet clarified how it will respond to the latest salvo.

"We can not turn a blind eye to China's mercantilist trade practices, but this action falls short of a strategy that will give the administration negotiating leverage with China while maintaining the long-term health and prosperity of the American economy", Hatch said in a statement.

OCBC estimated that in a scenario where U.S. tariffs apply to US$250 billion worth of Chinese goods, South Korea's GDP growth could be hit by 0.3 of a percentage point while Japan's growth could be hit by 0.2 of a percentage point.

If this round of tariffs moves forward, it would most likely be implemented in September, at the earliest, the Goldman analysts said.

The administration said the new levies are a response to China's decision to retaliate against the first round of U.S. tariffs.

Whether the trade war continues will depend on the political reaction to the current tariffs, says Gary Hufbauer, senior nonresident fellow at the Peterson Institute.

TESLA IN CHINA: Electric vehicle producer Tesla will build its first factory outside the United States in Shanghai.

Head of U.S. equity strategy at JP Morgan, Dubravko Lakos-Bujas, said: "Despite trade headlines, S&P 500 companies should deliver robust earnings on above-trend revenue growth and sharply higher margins".

Tuesday's list appears to target China's important manufacturing export industries.

It wasn't immediately clear how China would respond to the new tariff list.

The office of US Trade Representative Robert Lighthizer has released a list of Chinese products, running to nearly 200 pages, that will potentially be hit with a 10 per cent import tax as early as September. No financial details of the agreement signed Tuesday were announced, but construction is expected to start as soon as official permits come through.

US Senate Finance Committee Chairman Orrin Hatch described the move was "reckless".

Chinese officials are expected to retaliate in other ways, hitting USA firms in China with unplanned inspections, delays in approving financial transactions and other administrative headaches.

With more potential tariffs on the way, many Americans are wondering what impact they could feel.

Even more tariffs could be on the way.