BEIJING — China has warned it will strike back with tariffs on another $60 billion in American imports following President Trump’s escalation of the trade war, a move that could slap levies on almost everything the United States sells to the nation as early as next week.
Beijing’s proposed retaliation to Trump’s duties on an additional $200 billion in Chinese goods, set to take effect Sept. 24, would mark the first time the country hasn’t matched the United States tit for tat in the months-old commercial battle.
A day before Trump ordered the new tariffs, expanding the trade war between the world’s two largest economies by fourfold, Chinese officials maintained they felt forced to fight back.
“If the U.S. introduces any new tariff measures against China, China will have to take necessary countermeasures and resolutely safeguard our legitimate rights and interests,” Foreign Ministry spokesman Geng Shuang said Monday at a news conference in Beijing.
Officials did not immediately respond Tuesday morning.
China purchased roughly $130 billion in American goods last year — less than a third of what the United States ordered from Chinese enterprises. Now Beijing is poised to impose higher border taxes on a total of $110 billion in U.S. products.
In an August statement, China’s Commerce Ministry said it would respond to Trump’s latest round of tariffs with duties on more than 5,200 types of American imports, including industrial parts, chemicals and medical instruments.
Ni Feng, deputy director of the Institute of American Studies at the Chinese Academy of Social Sciences in Beijing, said he expects a swift response from the Chinese government.
“After his list is out, then China’s countermeasures will follow,” Ni said.
Cheng Dingding, founder of the think tank Intellisia at Jinan University in Guangzhou, said China will continue to welcome negotiations.
“We will fight and talk at the same time,” he said.
China’s vice premier, Liu He, was expected to visit Washington next week to restart negotiations with Treasury Secretary Steve Mnuchin, but analysts say the $200 billion development likely knocked that meeting off the table.
Fang Xinghai, vice chairman of China’s securities regulator, said at a forum in Tianjin on Tuesday that Trump’s tactics have “poisoned” the deal-making atmosphere.
Trump’s announcement landed in China on Sept. 18, a day considered the start of Japanese aggression 87 years ago and an anniversary some Chinese see as an informal day of national humiliation.
Beijing has said it would also unleash “qualitative” measures against the United States, which some American firms have interpreted as heightened regulations and stalled visas.
The threat of more tariffs on $60 billion in U.S. products — and Trump’s pledge to target another $267 billion in Chinese goods if that retaliation materializes — has concerned the American business community in China.
“Contrary to views in Washington, China can — and will — dig its heels in and we are not optimistic about the prospect for a resolution in the short term,” William Zarit, chairman of the American Chamber of Commerce in China, in a Tuesday statement.
China has maintained that it’s well positioned to withstand blows in a geopolitical tussle that could drag on indefinitely, even as the nation’s growth is projected to slow this year.
The country’s central bank, meanwhile, has allowed its currency to slide about 5 percent since January, giving Chinese exports an edge in overseas markets while making foreign imports costlier. (On Tuesday, it cost 6.88 renminbi to buy a dollar.)
Analysts say the People’s Bank of China probably won’t greenlight much more tumbling since a fading RMB could spook more assets out of the country.
“The weakening of the RMB could help offset the new tariffs,” said Larry Hu, chief China economist at Macquarie Commodities and Global Markets, a consultancy in Hong Kong. “However, it will also hurt China itself.”
Other signs of weakness in China’s economy as the trade war escalates include cooling consumer spending, slowing infrastructure investment and a relatively low but growing rate of corporate bond defaults.
The Shanghai Composite Index, meanwhile, has plummeted more than 20 percent since the year’s start, with losses snowballing after Trump launched the trade war.
Some analysts have predicted the business uncertainty will prompt layoffs in China, which currently has a tight labor market, with unemployment at 3.8 percent.
But demand for Chinese products on American soil has jumped amid rising tensions: the latest census data, released Wednesday, showed the U.S. goods deficit with China this year has grown about eight percent to $234 billion from the same time last year.
Deutsche Bank economists Zhiwei Zhang and Yi Xiong estimated in a September analysis that an escalated trade war will shave only a half percentage point off the country’s growth. Goods to the United States, they noted, accounted last year for just 12 percent of China’s total exports.
“The Chinese authorities likely feel no urgency to give in and agree with all the terms the U.S. side requested,” Zhiwei and Yi wrote.
Tim Stratford, former Assistant U.S. Trade Representative and managing partner of the global law firm Covington’s Beijing office, predicted at a World Economic Forum panel in Tianjin on Tuesday that the economic conflict will see no winner soon.
“They’re concerned the U.S. motivation is wanting to keep China down,” Stratford said. “I expect therefore we’re going to have a deadlock for quite some time.”
Luna Lin and Yang Liu contributed to this report.