China cancels trade talks with US

China flag US flag

China US flag | reuters

That coincided with the time for President Donald Trump's planned tariff hike on $200 billion of Chinese imports to take effect, though there was no immediate USA government confirmation it was collecting the higher charges.

The US on Monday imposed duties on another US$200 billion (S$273 billion) of Chinese imports, prompting China to respond by slapping tariffs of its own on US$60 billion of US goods. Beijing has repeatedly denied the charge. As China has said that step is certain, the stage appears set for yet another escalation of the trade war.

Hopes for talks to resolve the issue appeared to have been dealt a blow with hit as The Wall Street Journal reported Beijing cancelled the visit of a negotiating team expected September 27-28 in Washington.

Dialogue between the world's two biggest economies appears severed.

"While these actions seem to be already priced in, investors are becoming increasingly anxious that the trade war may enter phase III", Hussein Sayed, the chief market strategist at trading platform FXTM, said in an email on Monday morning.

Fitch, one of the "Big Three" ratings agencies along with Moody's and Standard and Poor's, was even more candid after cutting global growth estimates.

The latest round of USA duties took effect just after midnight Washington time on Monday (midday in Beijing) on a list of products ranging from frozen meat to television components.

China has made "enormous efforts" to stabilise bilateral economic and trade relations by holding discussions and proposing practical solutions, but the United States has been contradicting itself and constantly challenging China, reported Xinhua.

It leaves Beijing hitting $110 billion worth of USA goods, almost everything China buys from the United States.

China on Saturday called off planned trade talks with US officials with a move by the US State Department to sanction China's defence agency and its director on Thursday contributing to the decision, according to people familiar with the situation. Beijing believes substantive negotiations will only be possible after the USA midterm elections in November, Bloomberg News reported.

Efforts at diplomacy have failed, with no breakthroughs since high-level talks began in May. Earlier, he threatened Beijing with further tariffs on around $267 billion of imports if Beijing retaliates against the latest measure.

Still, the United States remains open to talks, Lindsay Walters, deputy White House press secretary, said.

The latest tariffs and the threat didn't deter Beijing from launching retaliatory tariffs on American goods worth $60 billion.

Companies complain that the time frame between the announcement of the latest levies and implementation of the tariffs on thousands of products is too short.

Though a senior White House official last week said the United States will continue to engage China for a "positive way forward", neither side has signalled willingness to compromise.

Latest News