China cancels trade talks with USA as new tariffs loom

China flag US flag

China flag US flag

As the Trump administration escalated the ongoing trade conflict, government officials from Beijing on Monday accused the White House of engaging in "trade bullyism" to intimidate other countries into submission, as reported by Reuters.

LONDON - European and Asian markets were lower on Monday after China said it won't negotiate with the U.S. on trade if the Trump administration continues to threaten higher tariffs.

The company representatives and other sources spoke on condition of anonymity because of the sensitivity of the issue.

Last week, Trump ordered a new package of duties on around $200 billion worth of Chinese goods, with China retaliating with $60 billion in United States goods. Trump has threatened another round of tariffs, effectively covering every product the United States imports from China, if Beijing retaliates against Monday's tariffs.

At SK Hynix, which makes computer memory chips, work is under way to move production of certain chip modules back to South Korea from China.

"The trade war is now a reality", said Fitch economist Brian Coulton.

The US has "made a series of false accusations, and used increasing tariffs and other means of economic intimidation, to try to impose its own interests on China by way of extreme pressure", the State Council (cabinet) said in a white paper on trade and economic tensions with Washington.

News of Beijing's decision to skip the talks pushed China's yuan currency down 0.3% on Monday in offshore trade, reinforcing investors' fears that both sides are digging in for a long fight.

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Beijing's latest tariffs include an additional 5 per cent duty on about 1,600 kinds of U.S. products including computers and textiles and an extra 10 per cent on more than 3,500 items including chemicals, meat, wheat, wine and liquefied natural gas.

Chinese leaders have announced changes this year including tariff cuts and plans to end ownership limits in their auto industry.

"It would look weak both to the U.S. and at home", he said, adding that there is "sufficient stimulus in the pipeline" to limit the damage of the latest tariffs on China's economy.

"With generic polls favouring the Democrats, they may feel that the trade environment will be less hostile after November 6". Beijing has repeatedly denied the charge.

"Following President Trump's threat of further escalation, we now think the probability that all imports from China will ultimately be subject to tariffs has risen to 60 percent", the bank's analysts wrote in a research note, quoted by media.

It contains 36,000 Chinese characters and condemns the United States for starting the trade war.

The pair have slapped tit-for-tat tariffs on $50 billion ($A68 billion) worth of goods since the trade war kicked off.

"The Trump administration must get its position straight though - what does it want from China, and who is empowered as a negotiator by President Trump to bring the deal home?"

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