Chinese soybean imports slump 8% in July as stocks build

Are Trumps Tariffs Actually Increasing The Trade Deficit

US tariffs make no dent on China exports surge

On Tuesday, the Trump administration announced it would go ahead with previously announced 25 percent tariffs on an additional $16 billion of Chinese imports.

The trade tensions between the US and China are increasing now that the Trump administration announced it will hit China with another round of tariffs and also increase the tariff rate on additional products in the future.

President Donald Trump to put pressure on China to negotiate trade concessions after imposing tariffs on US$34 billion in goods last month. It would likely have to impose penalties on USA companies doing business in China to make up the difference.

The Mainland China equity market inclined on Thursday, 09 August 2018, as investors continued hunting heavily battered stocks after the benchmark index fell to the lowest level in two and a half years early this week. China retaliated with higher duties on a similar amount of American goods.

While the policies have drawn loud complaints from US companies that have become reliant on imports from China, they have been forcing multinationals to rethink their supply chains and start moving them away from China. The long-term concern for a trade war remains: according to Oxford Economics, global production will be reduced by 0.7% by 2020, with China and US GDP impacted by 1.3% and 1% respectively. The bad news is the trade war fears in China are escalating.

The US and China are dependent on each other for the supply of pharmaceutical products. "President Trump is keeping his promises to the American people on trade, from withdrawing the United States from the flawed Trans-Pacific Partnership, to renegotiating NAFTA, to strongly enforcing USA trade laws", said Lighthizer.

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The Ministry of Commerce says it would impose tariffs at four different rates (5% to 25%) on the USA goods that would be targeted.

Beijing sent another warning shot to Washington on Thursday, with its state media accusing the US of "mobster mentality".

The comments mark a ratcheting up in tensions between the world's two largest economies over a trade dispute, which is already impacting industries ranging from steel to cars and causing unease over which products could be targeted next.

The US is a leading pharmaceutical market, with aggregate spending valued at $467 billion during 2017, and estimated to increase to over $600 billion by 2022. Hollywood studios and their trade body, The Motion Picture Association of America, had hoped to renegotiate a 2012 agreement to raise a Chinese quota on imported films and boost the share that overseas producers get of box-office takings, Atkinson explained.

Administration officials believe that the US$505b Americans spend on Chinese products each year gives them leverage over China.

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