China's reciprocal tariffs on US goods are now in effect
What's the story
China's tariffs of up to 15% on US farm goods have come into effect today. They hit a range of commodities from beef and poultry to grains.
The new tariffs come in response to the US's decision to double a blanket tariff on all Chinese exports.
The move is likely to escalate the ongoing trade dispute between the world's two largest economies.
Trade tension
China's response to US tariffs
Despite the escalating trade tensions, Chinese officials have expressed confidence in their ability to manage these disputes with President Donald Trump.
Finance Minister Lan Fo'an said the central government has sufficient fiscal policy tools and space to tackle potential domestic and external challenges.
Notably, China has also suspended soybean and log imports from the US.
Economic outlook
China's trade strategy amid economic challenges
The latest tariffs come ahead of the National People's Congress in Beijing, where Premier Li Qiang has set a growth target of around 5%.
This is an ambitious goal amid trade uncertainties, a property crisis, and deflation plaguing the economy.
Official data showed consumer inflation dropping below zero for the first time in 13 months.
To boost spending and counter US tariffs, China wants to raise its general budget deficit to the highest level in more than three decades.
Tariff escalation
Trump's tariff strategy and its impact
President Trump's latest round of tariffs includes a new 10% duty, along with 25% duties on imports from Canada and Mexico.
This is on top of the 10% levy the US imposed last month, making Chinese exports to America face duties of up to 20% at least.
The Phase I of the US-China trade deal in 2020 saw Beijing pledging to increase imports from Washington by $200 billion over two years.
Retaliation
China's response to US tariffs on agricultural products
In retaliation to America's moves, China announced 15% tariffs on wheat, corn, cotton, and poultry. There are also 10% duties on pork, soybean, dairy products, and beef.
China added 10 US firms to its 'unreliable entities list' over the sale of weapons to Taiwan.
Biotech major Illumina, which has the 'unreliable entity' tag, is prohibited from selling its gene-sequencing devices on the mainland.
The 'unreliable entities list' includes foreign companies and individuals that allegedly impinge upon Chinese interests.