Mr Trump, in light of what he called China's "unfair retaliation" against earlier USA trade actions, had upped the ante on Friday (Thursday local time) by ordering United States officials to identify extra tariffs, escalating a tit-for-tat confrontation with potentially damaging consequences for the world's two biggest economies.
President Donald Trump escalated tensions Tuesday, proposing tariffs on a range of Chinese-made products worth about $50 billion with a focus on high-tech items.
"If the United States side disregards opposition from China and the global community and insists on carrying out unilateralism and trade protectionism, the Chinese side will follow through, at any costs, till the end", the Ministry of Commerce said in a statement yesterday.
This trade fight will benefit cotton producers, but Brazil will not replace the United States, the largest exporters in the world. The next day, China fired back, matching Trump dollar-for-dollar with a plan to impose import duties on $50 billion worth of American products. The chief target was China, which answered with tariffs on US pork, fruit and nuts.
Washington called for its initial $50 billion in extra duties after it said an investigation had determined Chinese government policies are created to transfer USA intellectual property to Chinese companies and allow them to seize leadership in key high-technology industries of the future.
Trump on Thursday instructed the U.S. Trade Representative's Office to consider tariffs on an additional $100 billion in Chinese imports, bringing to $150 billion the range of Chinese goods under consideration.
The specter of a large-scale trade war between the world's two biggest economies - an event unprecedented in modern times - has people scrambling to anticipate the effects. A politician saying "we're running record trade deficits" and a politician saying "we're running record capital surpluses" are saying the same thing. The Dow fell more than 570 points, or 2.3 percent. Trade wars, however, are like real wars in that they are easy to start, but, once underway, the course is unpredictable and they can be hard to halt.
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On a NY radio show, the president said short-term economic pain would be worth it.
If the United States side disregards opposition from China and the global community and insists on carrying out unilateralism and trade protectionism, the Chinese side will follow through, at any costs, till the end. Gao said comments from USA officials about ongoing talks about trade issues were incorrect.
Trade wars, by contrast, are sure to cause economic harm in the short run - including higher prices to consumers, lost sales to farms and factories, and a drag on the US economy.
He also said no negotiations were likely in the current circumstances.
Trump's new round of tariffs would have similarly negative consequences for the USA pharmaceutical industry, which makes heavy use of ingredients produced overseas.
"Raw material prices, already on an uptrend since mid-2017, will likely be pushed up further as hoarding and speculation take place in anticipation and reaction to tariffs", he added. "If we can get those issues resolved positively, there's no damage to the American economy, it's all pluses".
Trump economic adviser Larry Kudlow, a free-trade advocate, tried to walk back the threats, but this president isn't necessarily guided by the opinions of even his closest advisers.