China fires riposte by imposing fresh levies on US agro-products

China has fired its riposte against Washington’s decision to impose fresh tariffs on steel and aluminum products, by levying up to 25 per cent duties, mostly on agricultural products sourced from the United States.

China's State Council imposed additional tariffs on 128 items imported from the U.S., including wine, nuts and pork. Earlier the U.S. had raised tariffs on steel and aluminum imports, including those from China. The Chinese decision took effect on Monday. U.S. tariff hike on steel and aluminum that took effect March 23.

Most of these items will pinch US President Donald Trump’s popular base among farmers.

15 p.c. tariff on 120 products

China imposed a 15 per cent tariff on 120 products, including wine, pistachios and walnuts, as well as fruits such as oranges, grapes and watermelons. Outside the basket of edibles, seamless steel pipes from the U.S. were also targeted. Last year U.S. exports to China of these products amounted to $1 billion.

Besides, authorities in Beijing strapped a 25 per cent tariff on goods worth nearly $ 2 billion on U.S. goods including pork and aluminum

scrap. On March 23, China had earmarked 128 items for fresh duties, which were open to public comment till the month-end.

Monday’s decision is not in response to the U.S. declaration of its intent to slap additional tariffs on Chinese imports worth nearly $60 billion.

“In this back-and-forth, Chinese leadership fresh out of a session of its National People’s Congress (NPC) does not want to appear week. It is likely that China will not stop shy of a tit-for-tat on what, potentially, could be a lead up to a trade war,” a Beijing-based academic who did not wish to be named told The Hindu.

China's Ministry of Commerce released a statement which said "China's suspension of some of its obligations to the United States is its legitimate right as a member of the World Trade Organisation."

On March 23, the U.S. imposed a 25 per cent additional tariff on steel imports and 10 percent on aluminum imports. Later this month, the U.S. is expected to publish a list of about 1,300 items from China for additional trade sanctions.

'Relatively mild step'

Former Chinese finance minister Lou Jiwei said last week that Chinese response had been “relatively mild” step, but more stringent measures could come that would target U.S. soybeans, cars and planes, could yet follow. In case US soybeans were restricted that would hurt farmers who have been big supporters of Mr. Trump.

The South China Morning Post quoted Gregory Moore, head of international studies at the University of Nottingham in the eastern China city of Ningbo, as saying the latest action by Beijing was another of the “opening salvoes of a trade war”, and that more were expected from both sides.

He added: “There’s going to be a few more exchanges … in this sort of nascent trade war. It's going to go a little further before things cool down.”

"China will keep pace with everything that the U.S. does."