U.S. tariffs against Chinese imports took effect early Friday, a day after President Donald Trump made clear he is prepared to sharply escalate a trade war between the world’s two biggest economies.
The administration started imposing tariffs at 12:01 a.m. Eastern time Friday on $34 billion worth of Chinese imports, a first step in what could become an accelerating series of tariffs.
Shortly after the tariffs took effect, China said it was “forced to make a necessary counterattack” to a U.S. tariff hike, but gave no immediate details of possible retaliation.
Later the Chinese foreign ministry confirmed retaliatory tariffs on U.S. goods “took effect immediately” after Washington raised import duties on its goods.
A foreign ministry spokesman, Hu Chunhua, on Friday gave no details of the increase. But Beijing previously issued a $34 billion list of American goods, including soybeans, electric cars and whiskey, it said would be subject to 25 percent tariffs.
The Commerce Ministry on Friday criticized Washington for “trade bullying” following the tariff hike in a spiraling dispute over technology policy that companies worry could chill global economic growth.
The Asian financial markets took Friday’s developments in stride.
Japan’s main stock market index, the Nikkei 225, gained 1.1 percent while the Shanghai Composite Index added 0.5 percent. Hong Kong’s Hang Seng rose 0.8 percent. Shares also gained in early European trading.
Hostilities could grow
Trump discussed the trade war Thursday with journalists who flew with him to Montana for a campaign rally. The president said U.S. tariffs on an additional $16 billion in Chinese goods are set to take effect in two weeks.
After that, the hostilities could intensify: Trump said the U.S. is ready to target an additional $200 billion in Chinese imports — and then $300 billion more — if Beijing refuses to yield to U.S. demands and continues to retaliate.
That would bring the total of targeted Chinese goods to potentially $550 billion, which is more than the $506 billion in goods that China actually shipped to the United States last year.
The Trump administration has argued that China has deployed predatory tactics in a push to overtake U.S. technological dominance. These tactics include cyber-theft as well as requiring American companies to hand over technology in exchange for access to China’s market.