Beijing then threatened to impose an additional $60 billion in tariffs on a variety of American goods - which White House economic advisor Larry Kudlow dismissed as "a weak response". Tariffs of 2,3 percent hardly represent a tariff war, let alone a trade war. The move has prompted concerns of a global trade war as each nation has responded with retaliatory tariffs on USA products. In thinking that China will be "broken" by U.S. tariffs, Donald Trump's nation is rapidly learning that a mutually disadvantageous trade war is far more disadvantageous to United States businesses than to Chinese industries. China has denied violating global trade norms.
The ministry also warned that it reserves the right of further countermeasures in the intensifying trade war. Farmer groups have decried the trade tensions as soybean futures slumped.
The State Council outlined the plan just days after the USA said it was considering higher tariffs on $200bn of Chinese goods than initially planned.
Others, including the US Trade Representative Robert Lighthizer and White House trade adviser Peter Navarro, insist that the reduction in the US trade deficit while necessary is by no means sufficient.
Liu said China's move is aiming to offset potential negative influences on domestic economic growth and stabilize market sentiment.
FILE PHOTO: Shipping containers, including one labelled "China Shipping", are stacked at the Paul W. Conley Container Terminal in Boston, Massachusetts, U.S., May 9, 2018.
He added, however, that the United States had been sending "massive strategic weaponry" into the South China Sea and the region as a show of military might that puts pressure on China and other regional countries. That's something that was going to happen anyway, with or without any agreement with Trump - and with or without his tariffs and tariff threats. It did not specify what they might be, but could include increased checks on USA products, delays in approvals for U.S. firms seeking licenses and other business requirements.
It was the latest in a series of tariffs, with the first being imposed by Trump back in early February. The U.S. can buy more because the economy is strong. The US wants concessions from China that it is not demanding from NAFTA, Europe and other allies.
The vehicle industry seems to have been the most affected so far, with three major automakers recently warning that changes to trade policies are hurting performance.
A dip in auto exports and rising oil prices in June drove the biggest increase in the U.S. trade deficit in 19 months, reversing much of May's export bonanza, the government reported Friday.
Kudlow added: "We will not let China steal our technology". The divergence between USA agriculture's collective struggle to retain healthy profits without access to the Chinese market and Huawei beating all of its American competitors to become the second most popular smartphone brand in the world just after South Korea's Samsung, is indicative of the fact that many of China's flagship brands cannot only survive but thrive even when being cut off from the U.S. market.
What has the USA defence and intelligence establishment especially anxious is China plans to leapfrog the United States in nextgen technologies like 5G wireless, Artificial Intelligence, and Cybersecurity. "These are the things we have asked them in a number of meetings". But what the U.S. really means is nextgen military-capable software intellectual property.