Trade war worries slam China and emerging markets

Markets drop over trade war fears

A man walks by an electronic stock board of a securities firm in Tokyo Monday

Last week, Mr. Trump announced plans for tariffs on $50 billion worth of imports from China in the technology sector, a move aimed at what he called "bringing balance to our trade relationship with China". China, claiming the United States had "launched a trade war", retaliated nearly immediately, outlining its own tariffs on USA goods worth $50 billion.

China had warned it will take "qualitative" and "quantitative" measures if the US government publishes an additional list of tariffs on its products. "These tariffs are essential to preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs", the president said at the time.

If the USA goes ahead with the new $200 billion tariffs, they are more likely to be directly felt by individuals than the previous round.

In announcing the possibility of new $200 billion in tariffs, Trump mentioned that he still has an "excellent relationship" with Chinese president Xi Jinping.

The tariffs could affect $50-$60 billion worth of goods and increase trade tensions. The trade relationship between the United States and China must be much more equitable.

China's Commerce Ministry said it would respond with tariffs "of the same scale and strength" and that any previous trade deals with Trump were "invalid".

Merkel and Macron have both stressed that the bloc must learn to stand its ground on the world stage, as Trump openly challenges the European Union with a trade war and over security and climate policy.

A trader on the floor of the New York Stock Exchange. The fact that America imports more from China will make it harder for Beijing to match Trump's attacks, according to Derek Scissors, a resident scholar at the conservative American Enterprise Institute in Washington who focuses on China.

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"And as a USA soybean farmer with the prices below break even now, it's definitely not good for us, either".

"While the White House is chasing some imaginary trade deficit, it will have very real consequences for the 1.3 million men and women of our industry".

China's proposed retaliatory tariffs on the United States target farm goods such as soybeans, as well as chemicals, oils and seafood.

Trump's latest tariffs Monday came on the same day the Senate voted to reverse the Commerce Department's recent move to save Chinese telecommunications giant ZTE by lifting a seven-year ban on the company doing business with US firms, which was imposed after ZTE was found violating the terms of 2017 penalty agreement.

U.S. tariffs that affect more than 800 Chinese products worth $34bn in annual trade are due to come into effect on 6 July.

President Donald Trump and Chinese President Xi Jinping shake hands at a joint news conference held after their meeting in Beijing on November 9, 2017.

Earlier this month, the Trump administration gave ZTE a reprieve after the company agree to pay fines, change management and agree to American oversight.

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