China, as promised, officially announced new retaliatory tariffs on USA goods on Saturday, claiming that the Trump administration had "launched a trade war" with Friday's imposition of 25 percent tariffs on some $50 billion worth of Chinese exports.
China said additional tariffs on 114 more USA items, covering chemical products, medical equipment and energy, will be announced later.
"We must take strong defensive actions to protect America's leadership in technology and innovation against the unprecedented threat posed by China's theft of our intellectual property, the forced transfer of American technology and its cyberattacks on our computer networks", Lighthizer says.
The US President also remarked that the White House could impose further tariffs in the face of any retaliation from China in the form of its own duties on American products.
China's Ministry of Commerce said the decision to impose tariffs meant "all previously agreed trade negotiation results are no longer valid".
"Given China's big trade surplus with the USA, it will be more hard and complicated for China" in the future to retaliate if the Trump administration expands the tariffs to more products, said Li.
These include major American exports to China like soybeans, which brought in $14 billion in sales a year ago, and are grown in states that supported Trump during the 2016 presidential election.
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Beijing appeared to be trying to minimize the impact on its own economy by picking USA products that can be replaced by imports from other suppliers such as Brazil or Australia.
It published a draft list of about 1300 Chinese products slated for tariffs in April.
The commerce ministry issued two lists of American goods - worth $50 billion in total - which will be hit with a retaliatory 25 percent tariff.
Tit-for-tat tariffs on products worth tens of billions have left the USA and China teetering on the brink of an all-out trade war, one Beijing can ill-afford with headwinds mounting for its economy.
"Neither side will be brought to its knees - which is one reason to think the trade dispute could drag on", Capital Economics said.
The new U.S. import duties are aimed at forcing Beijing to stop what the White House claims is the systematic theft of United States intellectual property and will apply to a wide range of products. The $50 billion in tariffs will likely mean just a tenth of a percentage point hit "at most" on annual USA economic growth and a similar jump in overall consumer prices, according to data from Barclays, the British bank. The U.S. imported more than $2.7 billion in Chinese seafood past year, and the U.S. exported more than $1.3 billion to China.
The reaction to the USA tariffs was muted on Chinese social media, failing to break into the top 100 trending topics on the country's Twitter-like Weibo. Canada also harvests lobsters and is a major trading partner with China.
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West Texas Intermediate (WTI) crude oil futures were up 0.2 per cent at US$67.02 per barrel, while Brent was at US$76.02. The Asia Pacific MSCI index ex-Japan edged down 0.3 percent and was set for a weekly loss of more than 1 percent.
USA stocks fell Friday morning, with industrial giants Boeing and Caterpillar especially hard-hit.
Unconfirmed rumours hold that the president will target China's United States tech sector, where network hardware maker Huawei has already been blocked from deals for alleged security concerns.
"Goods commonly purchased by American consumers such as cellular telephones or televisions" would not be affected, the office said. This includes goods related to China's Made in China 2025 strategic plan to dominate the emerging high-technology industries that will drive future economic growth for China, but hurt economic growth for the United States and many other countries.
The current dollar amount of USA tariffs imposed on Chinese goods are tiny, however, when compared to the size of the $18 trillion US economy.
Analysts at Capital Economics said the impact of the tariffs on China's economy would be small.
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