Trade war begins as China imposes tariffs on US goods

Donald Trump’s policy of imposing tariffs on rival nations reignited the first trade war of his new presidency yesterday, as China retaliated with its own wave of levies and an investigation into the US tech giant Google.

- ALISHA RAHAMAN SARKAR

The foreign ministry in Beijing imposed 15 per cent tariffs on coal and liquefied natural gas, while oil and agricultural equipment from the US will face a 10 per cent levy. The new tariffs will take effect on Monday.

Mr Trump’s 10 per cent tariff on Chinese goods, which Beijing called a “serious violation” of international trade rules, came into effect yesterday. It followed the announcement of a 25 per cent tariff on imports from both Canada and Mexico – though the implementation of these tariffs was paused at the last minute.

During his first presidential term, Mr Trump initiated a two-year trade war with China over its US trade surplus, with tit-for-tat tariffs upending global supply chains and damaging the world economy. “The trade war is in the early stages so the likelihood of further tariffs is high,” Oxford Economics said in a note as it downgraded its China economic growth forecast.