The trade spat that has bene termed by China as the “biggest trade war in economic history” has just escalated as Russia has slapped its own tariffs on US goods as a reaction to the US imposing import tariffs on foreign steel and aluminium.
This move follows a series of import tariffs and threat for more tariffs by the US and China on each other’s products worth billions of dollars.
Some road construction equipment, oil and gas equipment, metal processing instruments, drilling equipment and optical fibre are the US goods that have been slapped with additional import tariffs ranging between 25 per cent to 40 per cent, said Maxim Oreshkin, the economic development minister of Russia in Moscow.
The US tariffs of 25 per cent on steel and 10 per cent on aluminium, that were imposed in March, have been challenged at the World Trade Organisation (WTO) by the EU, India, China and Russia. National security reasons have been cited as the pretext of imposing the tariffs according to Washington.
Later, China has said hat it has filed a second complaint over the US tariffs with the WTO.
The new US tariffs resulted in loss of $537.6m for Russian steel and aluminium manufacturers, Oreshkin said. Only a partial compensation of $87.6m would be provided by the new Russian tariffs, he added.
The global implications and impact of hardline measures taken by the US has been a cause of concern for financial markets and even for a number of international partners of the US even as the trade wars have been defined as “good” and “easy to win” by US President Donald Trump.
Warning about the result of the escalation of the trade war, Cecilia Malmstrom, the EU’s trade commissioner, expressed her worries about the tit-for-tat tariff hikes between the United States and China, in a tweet.
“Worrying development with escalation of tariffs between US and China. Clearly damaging for the world economy. Trade wars are bad and not easy to win,” she wrote.
The war was first started by the US with 25 per cent tariffs on Chinese impor5ts worth $34bn. Later Trump even said that he was not averse to imposing tariffs on all of the $550bn worth of Chinese goods imported into the US. Many see this stringent policy of Trump as a strategy to hold on to his core constituency which got him to power in 2016.
Tariffs on similar volume and value of US goods have been imposed by China in a tit-for-tat move. Imposition of the tariffs on a range of products including soybeans, pork and electric vehicles, which are a part of a list published by China last month, was announced by the Communist Party newspaper People’s Daily. Tariff fears have particularly gripped the US soybean farmers as the product saw its prices drop by as much as 17 per cent over the last month.
(Adapted from Independent.co.uk)