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China, US kick off new round of tariffs in trade war

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Workers at Yong Du Shoes in Dongguan, China, which produces 800,000 to a million pairs of cowboy boots a year, almost all exported to the United States, Aug 27, 2019. China and the US began imposing additional tariffs on each other's goods on Sunday, the latest escalation in a bruising trade war.

[BEIJING] China and the United States began imposing additional tariffs on each other's goods on Sunday, the latest escalation in a bruising trade war, but US President Donald Trump said the sides would still meet for talks later this month.

Mr Trump, writing on Twitter, said his goal was to reduce US reliance on China and again urged American companies to find alternate suppliers outside China.

A new round of tariffs took effect from 0401 GMT, with Beijing's levy of 5 per cent on US crude marking the first time the fuel has been targeted since the world's two largest economies started their trade war more than a year ago.

The Trump administration on Sunday began collecting 15 per cent tariffs on more than US$125 billion in Chinese imports, including smart speakers, Bluetooth headphones and many types of footwear.

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In retaliation, China started to impose additional tariffs on some of the US goods on a US$75-billion target list. Beijing did not specify the value of the goods that face higher tariffs from Sunday.

The extra tariffs of 5 per cent and 10 per cent were levied on 1,717 items of a total of 5,078 products originating from the United States. Beijing will start collecting additional tariffs on the rest from Dec 15.

Mr Trump on Sunday cited comments from US economist Peter Morici, who claims the tariffs will not impact US consumers that much given a drop in the Chinese currency, and called on US companies to find suppliers outside of China.

"We don't want to be servants to the Chinese!" he said. "This is about American Freedom. Redirect the supply chain. There is no reason to buy everything from China!"

Later, he told reporters that talks with China were continuing and the two sides would meet in person in September.

"We are talking to China, the meeting is still on, as you know, in September," he said. "We'll see what happens, but we can't allow China to rip us off anymore as a country."

Chinese state media struck a defiant note.

"The United States should learn how to behave like a responsible global power and stop acting as a 'school bully,'" the official Xinhua news agency said.

"As the world's only superpower, it needs to shoulder its due responsibility, and join other countries in making this world a better and more prosperous place. Only then can America become great again."

Tariffs could not impede China's development, said the official People's Daily of the ruling Communist Party.

"China's booming economy has made China a fertile ground for investment that foreign companies cannot ignore," it said, in a commentary under the name 'Zhong Sheng', or 'Voice of China', which is often used to state its view on foreign policy issues.

Last month, Mr Trump said he was increasing existing and planned tariffs by 5 per cent on about US$550-billion worth of Chinese imports after Beijing announced its own retaliatory tariffs on US goods.

Tariffs of 15 per cent on cellphones, laptop computers, toys and clothing are to take effect on Dec 15.

The US Trade Representative's Office said on Thursday it would collect public comments through Sept 20 on a planned tariff increase to 30 pe cent on a US$250-billion list of goods already hit with a 25 per cent tariff.

Trade teams from China and the United States continue to talk and will meet in September, but tariff hikes on Chinese goods set to go in place on Sunday will not be delayed, Trump has said.

For two years, the Trump administration has sought to pressure China to make sweeping changes to its policies on intellectual property protection, forced transfers of technology to Chinese firms, industrial subsidies and market access.

China has consistently denied Washington's accusations that it engages in unfair trade practices, vowing to fight back in kind and criticising US measures as protectionist.

China has pressed the United States to cancel the tariff increase, but said last week that a September round of talks was being discussed between the two.

The trade war further strains Beijing-Washington ties, already overshadowed by US freedom of navigation exercises near Chinese-occupied islands in the disputed South China Sea, and US support for self-ruled and democratic Taiwan, which China claims as its own.

Mr Trump has also linked the trade talks and the protests in Hong Kong, saying he believes the negotiations with the United States had led Beijing to be more restrained in its response to the demonstrations in Hong Kong.

REUTERS