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Trade Dispute Grows Between The U.S. And China


Just after midnight last night, the U.S. fired the first shot in a trade dispute. The U.S. imposed tariffs on $34 billion worth of Chinese goods. And China responded by doing exactly the same to U.S. products. Many observers say this is escalating to a trade war between the world's two biggest economies. NPR's Rob Schmitz reports.

ROB SCHMITZ, BYLINE: Starting today, the U.S. will collect 25 percent tariffs on Chinese products such as semiconductors, farm equipment and industrial machinery. China has responded with equivalent tariffs on U.S. cars, soybeans, beef and other agricultural products. Longtime Beijing attorney James Zimmerman says this could be the start of a crippling trade war.

JAMES ZIMMERMAN: What we can expect is disruption. In supply chains, we can expect job losses and a decline in investor and consumer confidence. And that's going to impact the stock market. And the impact on U.S. business is going to be - in my opinion, will be substantial.

SCHMITZ: Zimmerman says the impact on Chinese consumers will also be damaging.

ZIMMERMAN: When you walk the streets of Beijing or Shanghai, you see them driving foreign cars. You see them wearing fashionable foreign garments. You see them using iPhones and so forth. I mean, and then the Chinese say, hey, I buy American goods. Why are you attacking us?

SCHMITZ: Zimmerman says this could easily turn to a more anti-American sentiment if the Trump administration makes good on promises of further tariffs in the coming weeks. If that happens, says Lester Ross, chairman of the Policy Committee of the American Chamber of Commerce in China, both the U.S. and China can expect tough times ahead.

LESTER ROSS: It will hurt everybody. On the other hand, if it actually leads to an improvement in terms of lowering trade and investment barriers - those barriers are higher in China than they are in the United States - then it could be a positive thing after some short-term pain.

SCHMITZ: But now, as tariffs are imposed on $68 billion worth of Chinese and American goods, Ross says it's unclear whether the Trump administration and China's leadership will have the patience to negotiate their way out of this. Rob Schmitz, NPR News, Shanghai. Transcript provided by NPR, Copyright NPR.

Rob Schmitz is NPR's international correspondent based in Berlin, where he covers the human stories of a vast region reckoning with its past while it tries to guide the world toward a brighter future. From his base in the heart of Europe, Schmitz has covered Germany's levelheaded management of the COVID-19 pandemic, the rise of right-wing nationalist politics in Poland and creeping Chinese government influence inside the Czech Republic.
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