China Answers US With $50 Billion in Tariffs

Workers transport imported soybean products at a port in Nantong, Jiangsu province, China March 22, 2018. China announced plans to increase taxes on $50 billion of U.S. goods, such as soybeans, airplanes and cars. (REUTERS/Stringer)

Tensions between the United States and China are increasing over trade issues.

On Wednesday, China announced plans to increase taxes on $50 billion of U.S. goods. The Chinese measures would increase tariffs by 25 percent on 106 products, such as soybeans, airplanes and cars. The Associated Press said the list includes the biggest U.S. exports to China.

China’s announcement answers U.S. President Donald Trump’s plan to increase tariffs on $50 billion worth of Chinese goods. The U.S. list, released Tuesday, strikes at China’s high-technology industries.

Chinese officials did not say when the tariff increase on U.S. imports would take effect. They say the timing will depend on what the Trump administration does.

Why the clash?

On the U.S. side, the tensions between the two countries is tied to Trump’s promise to reduce a trade deficit with China. Last year, the deficit was more than $375 billion.

On the Chinese side, the ruling Communist Party is trying to develop the country’s economy, especially high-tech companies. But foreign business people say Chinese rules limit competition and sometimes require them to help Chinese businesses improve their products.

Chinese officials say their government does not discriminate against foreign businesses. And the deputy commerce minister told reporters that China had not planned to increase taxes on U.S. imports. “It must be said, we have been forced into taking this action,” he said.

A cargo truck drives amid stacked shipping containers at the Yangshan port in Shanghai, Thursday, March 29, 2018. China's Commerce Ministry called on Washington on Thursday to discard planned tariffs.

What could happen next?

Many officials in both countries are urging the two sides to negotiate.

However, a small but active group of people in China are already calling for a boycott of U.S. products.

Internet commenters have noted the power of Chinese citizens. Last year, Chinese consumers informally boycotted South Korean goods after South Korea accepted a U.S.-made anti-missile system. Their boycott was estimated to have reduced South Korea’s economic growth last year by .4 percentage points.

As yet, observers do not see any signs of an organized campaign in China to reject U.S. goods. But they noted the danger of creating a negative image around American products.

Wine expert Jim Boyce lives in Beijing and writes a blog called Grapewallofchina. He said additional taxes on wine could have an effect, but that cost was not the only issue of concern.

“Are we going to see people in China worried about drinking American wine because of politics?” he said. “That’s the bigger problem.”

I’m Kelly Jean Kelly.

Kelly Jean Kelly wrote this story for VOA Learning English. Her story includes information reported by the Reuters news agency and the Associated Press. George Grow was the editor.

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Words in This Story

informally - adv. not officially

negative - adj. harmful or bad

blog - n. Web site on which someone writes about personal opinions, activities, and experiences

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