China hit back at US President Donald Trump's latest tariffs on Chinese goods on Monday, announcing tariffs of between 5 percent to 25 percent on 5,140 US-originated products effective June 1, showing a rational stance of Beijing and leaving room for the two to reach a final trade deal, experts said.
China said it will increase tariffs on part of $60 billion worth of US goods to 25 percent, 20 percent or 10 percent. For items that have previously been subject to a 5 percent tariff, the rate will remain unchanged, according to a statement released by the Customs Tariff Commission of the State Council, the cabinet.
All three major US stock indices plummeted on Monday opening after China announced tariff retaliation. The Dow fell more than 500 points, the S&P 500 index opened 48.50 points lower, down 1.68 percent to 2832.90 points. The Nasdaq Composite Index opened at 187.07 points, down 2.36 percent to 7729.87 points.
Dong Shaopeng, an expert advisor for the China Securities Regulatory Commission, told the Global Times on Monday that "China's rational move" will reduce impact to global industry chains. As China's reliance on the US is declining, China also does not need to retaliate through "adding hefty tariffs."
"The US side's tariff increase on China's exports to the US will gradually trigger disorder in the US consumer market, which is the US government's own making," Dong said, adding that the Chinese side is more resilient than the US.
China's raising tariffs on $60 billion US goods is a response to US unilateralism and trade protectionism. The Chinese side hopes that the US will return to the correct track of bilateral economic and trade consultations, and work together with China and strive to reach a mutually beneficial and win-win agreement on the basis of mutual respect, China's tariff commission statement said.
Room for discussion
China's retaliation is based on "certain principles" since the tariffs targeted $60 billion worth of US goods instead of more, the same amount as the country announced last year as countermeasures against higher US duties, Song Guoyou, director of Fudan University's Center for Economic Diplomacy, told the Global Times on Monday.
Hours after Trump announced tariffs on $200 billion worth of Chinese goods in September 2018, China responded with planned levies on $60 billion worth of US products.
Although China had to hit back, the country still left some room for hope that bilateral trade tensions would not further escalate and there might be future talks with the US, because the tariff rate was divided into different four categories, Song noted.
US officials on Friday increased an existing 10 percent tariff on $200 billion worth of Chinese goods to 25 percent, breaking a truce reached by the leaders of the two countries in December 2018 and highlighting the unreliable and unpredictable nature of the US administration.
The Chinese customs commission also said it will receive applications from relevant interested parties and exempt certain eligible products from the tariff hike announced Monday after reviewing the applications case-by-case. A list of exempted items will be formulated and published.
"If the US wants to further escalate its trade fight with China, we are not afraid. If it wants to sit down and talk with us, we also welcome. We've made our attitude quite clear from the beginning," Bai Ming, deputy director of theMinistry of Commerce's International Market Research Institute, told the Global Times on Monday.