China, U.S. Fire Off New Tariffs in Middle of Trade Talks

The restarted negotiations involve lower-level officials—both sides have played down hopes for major progress in this round of talks

Chinese-made tractor parts and machinery have been hit in the latest round of U.S. tariffs. Pictured here in 2012 is a tractor production line in Luoyang, central China's Henan Province. Photo: Zhu Xiang/Zuma Press
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BEIJING—China and the U.S. launched a fresh round of tariffs on $16 billion in each other’s goods, even as officials from both governments sat down for negotiations to resolve their monthslong trade fight.

Just after the U.S. Customs and Border Protection order went into effect at 12:01 a.m. Thursday, China’s Commerce Ministry announced the imposition of retaliatory measures. The tit-for-tat 25% duties cover Chinese-made chemicals, machinery, tractor parts and U.S.-produced fishmeal, industrial lubricants, engines and trucks, among other goods.

China’s Commerce Ministry also said it plans to file a complaint with the World Trade Organization about the latest round of U.S. tariffs. “The Chinese side resolutely opposes this and we cannot but continue to take necessary countermeasures,” the ministry said in a statement.

The timing for Thursday’s exchange of tariffs was set earlier this month. Since then, both governments agreed to restart negotiations. The talks, which opened Wednesday in Washington, are set to conclude later Thursday.

China has pledged to retaliate against U.S. tariffs in “equal scale and equal strength.” In addition to tariffs, here are three ways Beijing could hit back at Washington. Photo composite: Adele Morgan/The Wall Street Journal

The negotiations are being held by lower-level officials, rather than by Treasury Secretary Steven Mnuchin and Vice Premier Liu He, who tried and failed to resolve the impasse in May. And both sides have played down expectations for major progress in the current round.

A Chinese Foreign Ministry spokesman on Thursday reiterated hopes for a positive outcome. He declined to disclose details of the discussions, as did U.S. officials.

Thursday’s tariffs follow an earlier round of 25% levies on $34 billion worth of each other’s exports. The Trump administration is holding hearings this week on targeting another $200 billion in Chinese goods and could impose those penalties as early as next month. Since China imports far less from America than the U.S. does from China, Beijing plans to retaliate by slapping levies on $60 billion in U.S. exports.

The Trump administration has unleashed tariffs to try to pressure Beijing into curbing a trade imbalance that was $375 billion in China’s favor last year and to end practices that the U.S. says discriminate against American companies. Beijing attributes the trade imbalance to larger macroeconomic trends such as a lower U.S. savings rate, and denies its policies put foreign companies at a disadvantage.

—Liyan Qi