China says 'The US has started the biggest trade war in history'

Donald Trump US China Trade War

The US and China have the world's largest economies. Their decesions influence the entire world. Now, china has accused the United States of starting "the biggest trade war in economic history" as US tariffs took effect on Chinese goods worth $34 billion. China's Commerce Ministry said in a statement the country is forced to strike back to safeguard core national interests and the interests of its people.

The Trump administration's 25% tariffs are targeting Chinese products such as industrial machinery, medical devices and auto parts. The Commerce Ministry statement didn't provide details on China's retaliation. Beijing said previously it would fire back against an equal value of US exports, including SUVs, meat and seafood. Even before Friday, the trade dispute between the world's top two economies had rattled markets and prompted warnings from companies of damage to their bottom lines and higher prices for consumers. American companies doing business in China are particularly worried.

The biggest question is how far the hostilities between these two countries will go. The United States is also set to impose 25% tariffs on another $16 billion in Chinese exports later in the summer, and China has vowed to retaliate against US goods worth a similar amount. Economists say that if the back-and-forth stops there, the overall impact on both economies will be minimal even though some industries will suffer.

Trump has said his administration will respond to retaliation from Beijing with much bigger waves of tariffs, raising the prospect of worsening tit-for-tat reprisals. He suggested the possibility of tariffs on almost $500 billion more of Chinese goods.

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