Stocks open lower on escalating US-China trade dispute

Adjust Comment Print

Trade and business exchanges between South Korea and China turned chilly a year ago after South Korea deployed the USA -made Terminal High Altitude Area Defence (THAAD) anti-missile system despite vehement objections from Beijing.

General Motors shares reversed earlier losses and were last up 0.7 percent after the No. 1 U.S. automaker called for constructive U.S./ China dialogue, citing an "interdependence between the world's two largest automotive markets".

The market suffered a sharp dive after the opening bell after China struck back against the USA with threats to levy tariffs on more than 100 American-made goods ranging from autos to airplanes, as traders initially feared that it signaled an escalation in the trade fight between the world's two biggest economies.

Wednesday's Chinese tariff hike targeted goods including soybeans, the biggest USA export to China, and aircraft. This could be accomplished by reducing Chinese exports to the US, by raising the number of USA goods China imports, or a combination of both.

That was an amount which was "appropriate both in light of the estimated harm to the United States economy and to obtain elimination of China's harmful acts, policies and practices", it said. "Our action is restrained".

Zhu Guangyao, China's deputy finance minister, said Wednesday that Beijing hopes both sides can work together in a constructive manner, "instead of acting in a willful way".

Beijing has already shown it is willing to fight back.

Companies and economists have expressed concern improved global economic activity might sputter if other governments are prompted to raise their own import barriers.

"There is no victor in a trade war, and an initiator will harm itself as well as others".

"We hope the United States will actively respond to China's efforts to expand imports, Wang said, inviting American businesses to attend the first China International Import Expo in November and show their products and services to Chinese consumers".

GM shares were up 1.3 percent at $37.42 on Wednesday afternoon.

The statement went on to say it is "not conducive to the USA national interests, not conducive to China's national interests, and not conducive to global economic interests".

The Trump administration is urging China to lower tariffs on cars and open its market to USA financial services as part of talks to resolve a rise in trade tensions, a person familiar with the matter said earlier this month.

Chinese officials said they were obliged to act after the US announced plans for retaliatory tariffs in an escalating dispute over China's technology program and other trade issues.

Trump said in a tweet Wednesday morning that "we are not in a trade war with China". This could cut costs for USA meat companies.

Condom-snorting challenge latest fad to go viral online in America
That led to a rash of poisonings, with 142 reported by poison-control centers in January alone. The idea of threading a condom through your nose and pulling it from your mouth is not new.

About four per cent of the $35.4 billion of Canadian industrial chemicals exports go the China.

He accused the Communist nation of stealing USA intellectual property and applying it to their own technology, before shipping it back to America and undercutting home-grown suppliers.

Foreign companies are increasingly alarmed by initiatives such as Beijing's long-range industry development plan, dubbed "Made in China 2025". Companies complain that might block access to those industries.

A report released Tuesday by the USTR also cited complaints Beijing uses cyber spying to steal foreign business secrets.

Executive director John Ross said tariffs could change flows of exports but is unlikely to have an impact on prices.

American farmers are fretting that one of China's next target could be soybeans, an important USA agricultural export. That excludes high-end Boeing jetliners such as the 747 and 777, leaving Beijing high-profile targets for possible future conflicts.

Pain was also felt in the United States automobile industry, which is expected to hurt thanks to the Chinese tariffs.

China's state-run media says the probe will "poison" the relationship between the two countries, while the Chinese government later slams the Trump administration's "unilateralism and protectionism". China targeted a more focused, smaller number of products including soybeans and airplanes.

A pilot project announced in December that would allow China to accept Canadian chilled beef and pork provides another window of opportunity for Canadian producers, he added.

Experts say that Chinese hackers, widely viewed as among the most sophisticated, have shifted their operations so as not to explicitly violate the agreement while still maintaining a presence in US networks. Regulators could withhold licenses or alter other conditions to hamper foreign business activity.

Technology transfer between enterprises is voluntary based on mutual agreements without government intervention, he said. These large, global USA companies do a lot of business in China and overseas, which makes their sales and profits vulnerable if the two countries can't work out a deal before the threatened tariffs, which are still under review, go into effect.

China's embassy in Washington, D.C., issued a statement early Wednesday saying Beijing "strongly condemns and firmly opposes" the proposed list.

Mr Geng said China had referred the U.S. to the World Trade Organization.

Washington is trying to promote technology exports to offset its imports from China and support higher-paying jobs. Figures from the U.S. Commerce Department put last year's trade gap with the Asian nation at $337 billion.