U.S. tariffs have jumped, even as the talks enter the second day in Washington. The U.S. President Donald Trump last week announced that new tariffs would kick in on Friday, and so they did as the deadline passed midnight.
At the same time, China’s Commerce Ministry issued a statement noting that it would be taking countermeasures and added that Beijing “deeply regrets” how things have turned out.
Analysts had mixed on the outcome of the talks, with some experts hoping that a compromise or even solution could be arrived at before Thursday midnight. Nothing materialized and the tariffs on $200 worth of goods from China will now be subject to a 25% tariff, up from 10%.
With the tariff hike now in place, the sentiment is that the outcome of a continued trade war between the two countries will massively impact markets and damage the global economy.
Notably, those industries and businesses that are likely to face the brunt of the tariff increase will not be affected immediately. This is because the new charges will become applicable to goods exported after the levies come into force, which is after Friday, May 10.
According to a representative from the U.S. Trade department, the new tariffs will not goods that are already in transit to the U.S.
While China has threatened unspecified retaliatory measures, Trump has looked to ramp up the pressure by saying that a further 25% tariff will be slapped on $325 billion in yet-to-taxed goods from China.
The agreement is that it’s the citizens in the U.S. who will shoulder the brunt of the move and most farmers from some of Trump’s key voter states have called on the president to strike a deal with the Chinese.
But that is unlikely to happen unless today’s talks at the U.S. Treasury result in some sort of agreement. Up to now, the United States has imposed tariffs on a total of $250 billion worth of Chinese products, and that is set to rise even further.
China, on its part, has so far levied duties on about $110 billion worth of goods from m the United States.