China slapped tariffs on 106 U.S. products Wednesday in retaliation for the Trump administration’s recent tariffs targeting China.
The 25 percent tariffs will target up to $50 billion in U.S. goods, including cars, planes, propane, soybeans, beef, and whiskey.
Less than a day earlier, President Trump announced tariffs on around 1300 Chinese imports, including information technology, communication technology, educational equipment, and medicine, also amounting to about $50 billion a year.
The Dow Jones Industrial Average dropped almost 500 points as news of China’s new levies broke.
The dueling moves escalate mounting concerns that the U.S. and China will kick off a global trade war.
Commerce Secretary Wilbur Ross downplayed the new Chinese tariffs, saying they “amount to about three-tenths of a percent of our GDP. So, it’s hardly a life-threatening activity.”
Chinese vice finance minister Zhu Guangyao indicated China wants to “negotiate and cooperate” before the tariffs kick in on an unspecified date.
The U.S. action “seriously violates China’s legitimate rights and interests under World Trade Organization rules and threatens China’s economic interests and security,” China said.
“As the Chinese saying goes, it is only polite to reciprocate,” read a statement from the Chinese embassy in Washington, D.C.
President Trump has long decried what he says is a “trade war” the U.S. has already lost with China.
“We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S.,” Trump wrote on Twitter early Wednesday morning. “Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion. We cannot let this continue!”
U.S. aircraft company Boeing could suffer from the 25 percent Chinese levy on airplanes. Boeing was anticipating an increase in airplane sales to China, which will need 7,000 new planes worth almost $1.1 trillion over the next 20 years, the company predicted. Boeing stock dropped sharply after China’s announcement.