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Sino File | The US and China beware: trade war tariffs are a double-edged sword
- Recent rhetoric over the punitive duties suggests they have become the main stumbling block in trade negotiations between Beijing and Washington
- But while the US holds the upper hand for now, it should know from its history that a double-edged sword has global ramifications
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Tariffs are the key weapon of US President Donald Trump’s trade war with China, and thus they are also the key to eventually unlocking the intractable problems of the marathon US-China trade negotiation. Any good deal should include the removal of punitive tariffs.
But the latest inhospitable rhetoric over when and how much of these duties should be removed suggests the issue has become the main point of disagreement preventing Washington and Beijing from finalising their “phase one” deal on time, despite their claims it would be completed a few weeks after they reached an oral agreement during the October 10-11 trade talks in the US.
In the past week, Trump and his commerce secretary Wilbur Ross have threatened to move forward with their planned additional tariffs on December 15, while the Global Times – a nationalist tabloid affiliated with the People’s Daily, a Communist Party mouthpiece – tweeted that Beijing was insisting US tariffs must be rolled back as part of any trade deal.
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On December 2, the Trump administration expanded the scope of its trade rows by hitting Brazil and Argentina with steel tariffs and proposing levies against France, including slapping punitive duties of up to 100 per cent on imports of some products.
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Tariffs have historically been a tool for governments to collect revenue, but they are also used as a weapon to protect domestic industries and production in a trade war.
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