US President Donald Trump on Monday threatened new tariffs of 50 per cent on China, ratcheting up a trade war even as a dramatic selloff in global markets gathered pace.
Trump upended the world economy last week with sweeping tariffs that have raised fears of an international recession and triggered criticism even from within his own Republican Party.
In response to Trump’s tariffs, Beijing — Washington’s major economic rival — unveiled its own 34pc duties on US goods to come into effect on Thursday.
The US president on Monday chastised China for not heeding “my warning for abusing countries not to retaliate.” He said on social media that if China did not immediately back down “the United States will impose additional tariffs on China of 50pc, effective April 9th.”
With the incoming 34pc rate and new 50pc threat, the total additional tariffs this year could hit 104pc, the White House told AFP.
Trump also called Beijing “the biggest abuser of them all” on tariffs.
Chinese Vice Commerce Minister Ling Ji said the tit-for-tat duties “are aimed at bringing the United States back onto the right track of the multilateral trade system”.
“The root cause of the tariff issue lies in the United States,” Ling told representatives of US companies on Sunday.
Earlier today, shares in New York joined the slump, with all three major US indices falling more than 3 per cent in early trading.
European equities were deep in the red but Asia fared worse, with Hong Kong’s Hang Seng index crashing 13.2pc, its biggest drop since the 1997 Asian financial crisis, and Tokyo’s Nikkei 225 falling an eye-watering 7.8pc.
A 10pc “baseline” tariff on imports from around the world took effect Saturday, but a slew of countries will be hit by higher duties from Wednesday, with levies of 34pc for Chinese goods and 20pc for EU products.
Minutes before the markets opened in New York, Trump posted that his tariff reforms were “a chance to do something that should have been done decades ago”.
“Don’t be weak! Don’t be stupid! … Be strong, courageous, and patient, and greatness will be the result!” he urged.
EU trade ministers gathered in Luxembourg on Monday to discuss the bloc’s response, with Germany and France having advocated a tax targeting US tech giants.
“We must not exclude any option on goods, on services,” said French Trade Minister Laurent Saint-Martin.
50 countries have reached out to Trump to negotiate.
Japan’s Prime Minister Shigeru Ishiba said on Monday he had held a call with Trump in which they agreed to more talks on the tariffs.
Benjamin Netanyahu, prime minister of Israel — hit with 17pc tariffs, despite being one of Washington’s closest allies — was due on Monday to become the first leader to meet Trump since last week’s announcement.
Vietnam, a manufacturing powerhouse with a big trade surplus with the United States, has already reached out and requested a delay of at least 45 days to thumping 46pc tariffs.
