Bound for market: Trade between the US and China will be hit by tariffs and retaliations. Picture: REUTERS
Bound for market: Trade between the US and China will be hit by tariffs and retaliations. Picture: REUTERS

Beijing — Companies and trade groups in the US and China have expressed concern over the trade spat between the world’s two biggest economies.

Beijing retaliated to tariffs on tens of billions in Chinese imports imposed by US President Donald Trump on Friday, igniting a trade war that threatens to cut into the pair’s massive bilateral trade — potentially harming US multinationals keen on China’s huge market.

Top among US products hit with duties are agricultural exports, with soya beans, sorghum, oranges, pork, poultry and beef included in the $34bn of goods targeted for higher border taxes from July.

Agricultural trader Cargill, the largest US private company, called for dialogue between Beijing and Washington so businesses, farmers and consumers would not be caught up in an all-out trade war. A spokeswoman for grain trader Archer Daniels Midland also said dialogue should be pursued.

Friday’s announcements cap months of sometimes fraught shuttle diplomacy between Washington and Beijing, in which Chinese offers to purchase more US goods failed to assuage Trump’s grievances over a soaring trade imbalance and the country’s industrial development policies.

Beijing has left the door open to negotiations.

"The Donald Trump administration has once again proved inconsistent and precarious," state-run newspaper China Daily editorialised on Saturday.

It added that given the "frequent flip-flopping" in the US "it is still too early to conclude that a trade war will start".

US trade groups also stepped up criticism, and some large companies such as Boeing said they were beginning to evaluate the tariffs’ possible effects.

Boeing garnered about 12.8% of its 2017 revenues from China and is frequently seen as among the more vulnerable US multinationals to a full-on trade war.

"We are assessing the impact these tariffs and any reciprocal action could have on our supply chain and commercial business," said Boeing spokesman Charles Bickers. "We will continue to engage with leaders in both countries to urge a productive dialogue to resolve trade differences, highlighting the mutual economic benefits of a strong and prosperous aerospace industry," he added.

The American Apparel & Footwear Association said on Friday that China’s retaliatory measures could harm American farmers and textile manufacturers and add costs to the industry’s supply chain. "President Trump is fixated with tariffs, which he believes he can wield freely; but there are grave consequences," said association president Rick Helfenbein.

"Congress needs to step in now to end this dangerous obsession," he added.

Other trade groups opposing the US tariffs included the Business Roundtable and the US Chamber of Commerce.

US car makers, which have targeted China as a key growth market, are expected to be hit by the bruising tariffs. Ford has sold 338,386 cars thus far in China in 2018 and had welcomed a Chinese plan to lower tariffs on imports.

AFP

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