Business Roundtable said unilaterally imposing tariffs or other restrictions without a long-term strategy to bring about reforms in China will only raise prices in America, make American companies and products less competitive, and harm United States workers and consumers.
It said it has compiled a list of 120 products worth almost $1 billion, including fresh fruit and wine, upon which it would impose a 15 percent tariff if the two countries fail to resolve their trade differences "within a stipulated time".
If the US imposes a 25 percent duty on $50 billion of imported goods, the additional $12.5 billion tariff is equivalent to an additional 2.9 percent charge on all of China's exports, according to JPMorgan economists led by Haibin Zhu in Hong Kong.
However, countries trading with China are equally concerned about business requirements that force the transfer of technology to Chinese partners.
The inevitable fall in demand from a full-blown trade war would spell trouble for all the economies supplying the United States and China.
So far, China's response to Trump's announcement has been muted. The president has frequently taken aim at China's huge surplus in goods trade with the United States, which reached $375 billion previous year. In addition, Trump will also direct the US Treasury to propose measures that could restrict Chinese investments in the United States, Eissenstat said. Trump himself has tweeted, saying trade wars are "good", and "easy to win". "The President has fought very hard for advancing opportunities, economic opportunities for American businesses, but also the American people", she said.
The US President claims China has for years engaged in unfair trade practices that have hurt US firms. US Trade Representative Lighthizer warned on Wednesday that Washington would take "counter measures" if Beijing targeted US agriculture.
China also announced retaliatory measures against the US. "It has been very expensive for America", said Navarro. Chinese President Xi Jinping sent two high-level envoys to Washington last month, but neither managed to resolve the situation, he pointed out.
"The actions undertaken by the United States are self-defeating", said the statement, warning that they will directly harm the interests of USA consumers, companies, and financial markets. He warned that USA apple growers are going to "get hurt in a fight we didn't start and in which we have no interest". Even smaller-scale trade actions like Obama's tariffs on tires or Bush's on steel yielded more job losses than gains, studies have found. The metal tariffs have since been softened by the USA with multiple exemptions for Canada, Mexico, South Korea, Brazil, South Korea and Germany, which account for more than half of all imports. However, the two countries say they are in talks.
The administration's calculation seems to be that China will back down on intellectual property theft if faced with less access to US markets. "We feel that focusing on reciprocal treatment while maintaining strong communications between the governments will be the best path forward to get to our goal of a level playing field based on fairness".
Beijing urges the U.S.to hold to previous undertakings, cease "any kind of official exchanges and interactions with Taiwan, and properly deal with the Taiwan-related issue with caution so as to avoid severe damage to the China-U.S. relations and peace and stability in the Taiwan Strait", Chinese foreign ministry spokesperson Hua Chunying said at a regularly scheduled briefing.