“It has just got worse but it’s also got worse within relatively predictable parameters,” Asia correspondent Helen-Ann Smith says after China raised retaliatory tariffs on US goods.
That’s because every time Trump has raised tariffs, China has responded by matching the new tariff level – this time at 125%.
“That’s what we got from Trump a couple of days ago. That’s what we have from China now. So it’s following this pattern.”
One of the most important things to come out of the statement from Beijing, Helen-Ann says, is the Chinese calling the situation a “numbers game” and that raising tariffs at this stage doesn’t really mean anything in the real world.
“And that’s true really, because once tariffs have got over 60% or 70% it basically renders trade between the two countries impossible.
“So whether it’s 100%, 150%, 200%, even 100% it doesn’t really make much difference. Trade has essentially been obliterated anyway.”
The question is what happens next. There are two options, she says: either an ongoing “stalemate” where these countries are not trading with each other anymore or Trump might pursue political or other measures against China, which could provoke a response.
