China Fires Back, Announcing Tariffs on US Planes, Cars and Soybeans
China is firing back in the escalating trade tensions with the United States, announcing plans for heavy new tariffs on dozens more US goods including aircraft and autos.
The Chinese Ministry of Commerce on Wednesday said it plans to impose a 25% tariff on $50 billion worth of US exports. The 106 affected products will also include soybeans and chemicals.
China's announcement is a direct response to the Trump administration's publication Tuesday of a list of about 1,300 Chinese exports -- also worth about $50 billion annually -- that it intends to target with 25% tariffs.
The quickfire exchange of threats is intensifying fears of a full-blown trade war between the world's two largest economies. Markets fell sharply as news of China's plans emerged.
China said the planned US move "seriously violates China's legitimate rights and interests under World Trade Organization rules and threatens China's economic interests and security."
It's still not clear when the new waves of tariffs announced by the two sides might take effect -- or if they'll be watered down in the meantime. China said the timing would be announced separately. The US government said it will hold a public hearing for US businesses about its plans next month.
Related: US proposes tariffs on 1,300 Chinese goods
Many of the planned US tariffs would target the Chinese aerospace, tech and machinery industries. Others would target medical equipment, medicine and educational material, such as bookbinding equipment.
China has already proved that it is willing to fight back. On Monday, it put into effect tariffs on about $3 billion worth of US imports, including wine, pork, fruit and steel pipes.
Those measures were a response to the Trump administration's earlier tariffs on imports of steel and aluminum from China and other countries. Beijing has called the metal tariffs an abuse of global trade rules.
China's latest move to hit back in its spat with the United States had an immediate impact on markets Wednesday.
Hong Kong's benchmark Hang Seng Index slumped on the news, closing down more than 2%. US stock futures were also pointing to losses, with the Dow down 1.7% early Wednesday.
Plane maker Boeing plunged more than 5% in premarket trading, and GM was down almost 3%.
Commodity markets were also suffering. The price of soybeans, a major US agricultural export to China, fell more than 4%.
(PHOTO: AFP/Getty Images)