US President Donald Trump, flanked by ‪Vice-President Mike Pence‬, Commerce Secretary Wilbur Ross and US Trade Representative Robert Lighthizer. Photo: Rueters/Jonathan Ernst

US President Donald Trump on Thursday signed an order directing his trade representative to impose tariffs on a range of Chinese products. Along with the tariffs, new investment restrictions will be erected and actions will be taken against China through the World Trade Organization, the president said.

“The word that I want to use is reciprocal. When they charge 25% for a car to go in, and we charge 2% for their cars to come into the US, that’s not good,” Trump said. “That’s how China rebuilt itself.”

The president said that the tariff amount would be nearly US$60 billion, a bit steeper than the widely reported number of US$50 billion. He added that the administration is in ongoing talks with officials in Beijing on how to reduce the trade deficit, which Trump suggested was the largest bilateral trade deficit in the history of the world.

Meanwhile, China’s state-owned nationalist tabloid Global Times did not hold back in rallying the Chinese public for a response. “Chinese people, wake up! Trump has started war!,” read a headline on the publication’s Chinese-language website.

The news outlet has been warning in recent months that China is prepared to engage in a tit-for-tat battle with the US on trade, with editor-in-chief Hu Xijin saying on Wednesday that agricultural products will be the first to get hit. “China is far more resilient than the US to the pain,” Hu said on Twitter.

US Commerce Secretary Wilbur Ross said the administration expects retaliation from China, but is not concerned.

“There will be some ultimate retaliation, but I don’t think it’s going to be the end of the earth,” Ross told CNBC.

He added that the US$60billion number is a “tiny fraction” of the two countries’ economies.

“It’s not as though we’re blowing them up,” he said. “This is not going to put China into a depression. It’s not going to put us into a depression. This is simply trying to cure abuses.”

While the tariffs announced Thursday are ostensibly a retaliation for the alleged practice of intellectual property theft in the technology sector, Trump stressed the concept of reciprocity in all trade barriers during his announcement. In doing so, he implied he would seek to place levies on imported products based on tariff levels the same product exported to the same country would face.

Critics have warned that this tactic risks blowing up the WTO in flouting a fundamental principal of the global trading system, the principle of non-discrimination. Under WTO rules the United States extends something called most favored nation status to trading partners, unless the status is suspended by specific regulation, which means that tariff levels must be applied equally to all trading partners.

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