Retaliatory tariffs on US goods ‘aim to cause pain’

A senior member of a leading national think tank says China’s retaliatory tariffs on the US aim to cause pain. Lau Siu-kai, a consultant to the Chinese Association of Hong Kong and Macau Studies, said that given the difficult trade situation, China’s retaliatory measures were not gestures, saying otherwise they would be meaningless.

On Friday, Beijing announced it would impose a 34 percent tariff on all US imports starting on April 10. The move was in response to US President Donald Trump’s announcement on April 2 of a fresh round of tariffs targeting countries worldwide. They included a 34 percent tariff on Chinese goods in addition to the previous 20 percent levy.

Washington also made no distinction between goods coming from the SAR and the mainland. In response, Lau said – apart from imposing countermeasures on Washington should Beijing request such a move – Hong Kong could also consider placing levies on US goods.

Meanwhile, Terence Chong, executive director of Chinese University’s Lau Chor Tak Institute of Global Economics and Finance, believes Beijing’s latest round of tariffs will cause US stocks to fall further.

He said a recession would likely occur in the US in the next few quarters due to inflationary concerns and the reduction in GDP caused by a decline in consumption.

Chong also said the US might impose additional tariffs in response to Beijing’s move, further reducing trade between the two countries.