'No more!': Donald Trump warns China over 'crazy trade'
Internet modems, furniture and car parts are among the products affected by a tariff hike introduced by the US leader.
Friday 10 May 2019 20:59, UK
Donald Trump fuelled tensions with China with a warning over trade as聽Philip Hammond聽told Sky News that聽a "full-blown trade war" between the nations聽"would be very dangerous" for the global economy.
The American president took aim on Twitter as talks between US and Chinese negotiators continued on Friday.
"We have lost 500 Billion Dollars a year, for many years, on Crazy Trade with China. NO MORE!" he wrote.
However, the chancellor, Mr Hammond, said he was "optimistic" that an all-out trade war could be avoided, but admitted that the UK's economy could be affected by growing tensions between the two countries.
Mr Hammond said it was "disappointing" to see talks break down between China and the United States, and called on them to resolve their differences through the World Trade Organisation.
Prime Minister Theresa May is also reportedly "concerned" by the stand-off between the US and China after President Trump increased tariffs on $200bn (£153bn) worth of Chinese imports.
Number 10 said "no one benefits from trade wars" and hopes the two nations will find a solution.
France had already responded by saying the trade war was the single biggest threat to the world economy with the spat already being blamed for curbing growth over the past year.
On Twitter, Mr Trump said he was in "absolutely no rush" to finalise a trade deal with Beijing as US negotiators continued with talks "in a very congenial manner".
He added: "We will continue to negotiate with China in the hopes that they do not again try to redo deal!"
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The tariff hike comes despite American and Chinese negotiators meeting for last-ditch talks in Washington on Thursday.
Import taxes on products from 5,700 categories rose from 10% to 25% at 12.01am Washington time (5.01am UK time).
A series of Chinese-manufactured consumer goods are on the list.
They include:
:: Vacuum cleaners
:: Christmas lights
:: Cooked vegetables
:: Car parts
:: Internet modems
Speaking in Oxford today, Mr Hammond told Sky News: "We have already seen a negative effect on forecasts of global growth, largely caused by trade tensions between China and the US, so this is a worry. We were hoping that we were moving towards a solution of this long-running dispute so it is disappointing to see what looks like a setback in that process.
"But I'm optimistic that, in the end, there will be a deal. That's very important for us in the UK because our economy is very open so we are very exposed to what is happening elsewhere in the world.
"Clearly if there was a full-blown trade war between the world's two largest economies, that would be very serious indeed for growth prospects across the world as a whole, including the UK. That would be very dangerous but I am optimistic that we won't get to that."
Experts said it would take several months for US consumers to notice any increase in cost - assuming the tariff hikes were passed on in full.
By increasing import tariffs, the United States is making the Chinese goods less attractive to its people - encouraging shoppers and businesses to look elsewhere, preferably domestically.
China, which had threatened to retaliate if President Trump carried out his threat, responded by saying it "deeply" regretted the escalation and there would be "countermeasures" to come.
Its foreign ministry committed to the current round of talks in Washington but cautioned that the US must meet it half way.
The White House had given just a week's notice of the tariff increase, accusing Beijing of scuppering an agreement by reneging on its promises at the last moment.
Areas of dispute include intellectual property theft and forced technology transfers.
Some US business leaders have warned that the escalation is an own-goal as it will hit domestic consumers and small companies the hardest.
Gary Shapiro, chief executive of the Consumer Technology Association, said: "Our industry supports more than 18 million US jobs but raising tariffs will be disastrous.
"The tariffs already in place have cost the American technology sector about $1bn (£770m) more a month since October. That can be life and death for small businesses and start-ups that can't absorb the added costs."
Financial market reaction has been mixed - after a week of losses for shares linked to the escalation.
The Shanghai Composite rose 3.1% by the close but only after state intervention to prop up values.