The United States and China exchanged their first shots on Friday in a trade war that’s been brewing for several months and shows no signs of slowing in the near future. The U.S. was the first to draw blood, implanting tariffs on Chinese imports on schedule, and China was quick to reply with its own tariffs on U.S. goods including lobsters, soybeans and cars, as well as a public announcement that it was Washington that started the war.
“Trade war is never a solution,” Chinese Premier Li Keqiang said at a news briefing with Bulgarian Prime Minister Boyko Borissov in Sofia before a summit with 16 central and easternEuropean countries.
“China would never start a trade war but if any party resorts to an increase of tariffs, then China will take measures in response to protect development interests,” he said.
U.S. President Donald Trump responded by threatening additional tariffs on nearly $500 billion of Chinese goods, roughly the total amount of U.S. imports from China in 2017.
Traders, economists and politicians are now concerned with what will happen next. Though it would take some time for Washington to implement another wave of tariffs, the current tariffs may show quick impact on the financial markets and on Trump’s popularity within his voting constituency and his political alliances.
Some of Trump’s fellow Republicans in Congress already spoke against his actions.
“Tariffs not only hurt our farmers, ranchers and airplane manufacturers, but they also harm every American consumer. We should be working with our allies to isolate China rather than escalate a trade war,” said Senator Jerry Moran, who represents the agriculture-heavy state of Kansas.
There has been no attempt at resolution through negotiations thus far, and no talks are on the horizon.