As the US-China trade tension intensifies, China in a swift move has hit back with reciprocal tariff on the US goods worth US$ 50 billion. The move hints at a full-blown trade war between the world's two largest trading nations that caused a heavy sell-off in the global equity markets.
The reaction comes in after the US made an announcement on Tuesday of a proposed list of 1,333 products imported from China on which an additional tariff of 25% amounting to USD 50 billion would be levied. The Office of the US Trade Representative (USTR) published a proposed list of products imported from China that could be subject to additional tariffs. The list includes China's high-tech products such as electric cars, industrial robots, jet engines and locomotives.
Countering the move, China on Wednesday said it would impose 25% tariff on 106 products under 14 categories imported from the US that include soybeans, automobiles, whisky, chemicals, and aircraft. As per a CNBC report the effective date for the levy of the tariffs will be announced at a later date.
"Disregarding strong representations by China, the US announced the tariff proposals that are completely unfounded, a typical unilateralist and protectionist practice that China strongly condemns and firmly opposes," China's Ministry of Commerce (MOC) said today.
US President Trump has accused the Chinese economy of robbing the US by a variety of ways that includes intellectual property theft. In March, Trump signed a memorandum that could impose tariffs on some $60 billion in Chinese imports .
Global stocks immediately after the announcemen reacted quickly with Dow Futures, European stocks and Sensex shedding 1%.