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| Why is Donald Trump threatening more tariffs – and what next? | Why is Donald Trump threatening more tariffs – and what next? |
| (30 days later) | |
| What is Trump’s latest tariff threat towards China? | What is Trump’s latest tariff threat towards China? |
| Raising the stakes in the escalating trade standoff between the US and China overnight, Donald Trump has asked US trade officials to draft plans for additional tariffs on $200bn (£152bn) of Chinese imports. The president wants them set at a 10% rate, while indicating he would be prepared to impose tariffs on yet another $200bn of imports if China were to retaliate. | Raising the stakes in the escalating trade standoff between the US and China overnight, Donald Trump has asked US trade officials to draft plans for additional tariffs on $200bn (£152bn) of Chinese imports. The president wants them set at a 10% rate, while indicating he would be prepared to impose tariffs on yet another $200bn of imports if China were to retaliate. |
| Has the US already imposed tariffs on China? | Has the US already imposed tariffs on China? |
| The latest measures come on top of $50bn of tariffs approved by the White House, effective from 6 July, in retaliation to alleged intellectual property theft by China. These latest measures come as an escalation and could make it difficult for China to retaliate further, given the country only imported about $170bn of US goods and services last year. | The latest measures come on top of $50bn of tariffs approved by the White House, effective from 6 July, in retaliation to alleged intellectual property theft by China. These latest measures come as an escalation and could make it difficult for China to retaliate further, given the country only imported about $170bn of US goods and services last year. |
| The $50bn tariffs focus on industrial sectors designed to benefit from the “Made in China 2025” industrial strategy put forward by Beijing, and cover products ranging from aircraft to robots and cars. The list does not include products regularly bought by US consumers, such as mobile phones and TVs. | The $50bn tariffs focus on industrial sectors designed to benefit from the “Made in China 2025” industrial strategy put forward by Beijing, and cover products ranging from aircraft to robots and cars. The list does not include products regularly bought by US consumers, such as mobile phones and TVs. |
| Trump threatens new tariffs on $200bn in Chinese imports | Trump threatens new tariffs on $200bn in Chinese imports |
| Has China retaliated? | Has China retaliated? |
| Responding to the first wave of proposed tariffs, China has drawn up a list of like-for-like tariffs on $50bn worth of US products such as soya beans, cars and aircraft – but it has yet to impose them. On Tuesday, Beijing promised “strong countermeasures” should America go through with its latest threat. China’s commerce ministry noted: “If the US loses its senses and publishes a new list [of tariffs], China will be forced to take comprehensive measures that are both strong in quantity and gravity and will fight back.” | Responding to the first wave of proposed tariffs, China has drawn up a list of like-for-like tariffs on $50bn worth of US products such as soya beans, cars and aircraft – but it has yet to impose them. On Tuesday, Beijing promised “strong countermeasures” should America go through with its latest threat. China’s commerce ministry noted: “If the US loses its senses and publishes a new list [of tariffs], China will be forced to take comprehensive measures that are both strong in quantity and gravity and will fight back.” |
| What about tariffs on the UK and Europe? | What about tariffs on the UK and Europe? |
| Trump is fighting trade disputes on multiple fronts. China might stand apart as the biggest target for the US president but his traditional allies are in the crosshairs for different reasons. In May, Trump announced steel and aluminium tariffs on the rest of the world in order to protect US producers – and has refused to exempt the EU (including the UK), Canada and Mexico. | Trump is fighting trade disputes on multiple fronts. China might stand apart as the biggest target for the US president but his traditional allies are in the crosshairs for different reasons. In May, Trump announced steel and aluminium tariffs on the rest of the world in order to protect US producers – and has refused to exempt the EU (including the UK), Canada and Mexico. |
| Each trading partner has promised countermeasures should Trump refuse to back down, while seeking to settle the dispute at the World Trade Organisation. | Each trading partner has promised countermeasures should Trump refuse to back down, while seeking to settle the dispute at the World Trade Organisation. |
| Why is Trump imposing the tariffs? | Why is Trump imposing the tariffs? |
| During the 2016 election campaign, Trump promised to protect American jobs and to renegotiate US trade deficits with countries around the world. The US has the world’s largest trade deficit – meaning it buys more goods and services from other countries than it sells overseas – worth $568bn last year. | During the 2016 election campaign, Trump promised to protect American jobs and to renegotiate US trade deficits with countries around the world. The US has the world’s largest trade deficit – meaning it buys more goods and services from other countries than it sells overseas – worth $568bn last year. |
| China is responsible for the bulk of the deficit in terms of goods, exporting $376bn more to the US than it bought from US producers. | China is responsible for the bulk of the deficit in terms of goods, exporting $376bn more to the US than it bought from US producers. |
| What are the potential consequences for the global economy? | What are the potential consequences for the global economy? |
| When the first raft of Chinese tariffs were put forward, analysts believed the consequences could be contained, but now the stakes are rising and attitudes appear to be hardening on both sides. | When the first raft of Chinese tariffs were put forward, analysts believed the consequences could be contained, but now the stakes are rising and attitudes appear to be hardening on both sides. |
| Analysts at the consultancy Oxford Economics estimate the combined $250bn of US tariffs on China with retaliatory countermeasures would lower GDP growth by up to 0.3% in both countries. The World Bank has also warned a worldwide escalation of tensions would have consequences for global trade equivalent to the financial crisis of 2008. | Analysts at the consultancy Oxford Economics estimate the combined $250bn of US tariffs on China with retaliatory countermeasures would lower GDP growth by up to 0.3% in both countries. The World Bank has also warned a worldwide escalation of tensions would have consequences for global trade equivalent to the financial crisis of 2008. |
| International trade | International trade |
| Economics | Economics |
| Global economy | Global economy |
| Donald Trump | Donald Trump |
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