China fires back, announcing tariffs on US planes, cars and soybeans

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(CNN): The Chinese Ministry of Commerce on Wednesday said it plans to impose a 25% tariff on $50 billion worth of US exports. The 106 affected products will also include soybeans and chemicals.

China’s announcement is a direct response to the Trump administration’s publication Tuesday of a list of about 1,300 Chinese exports — also worth about $50 billion annually — that it intends to target with 25% tariffs.

The quick-fire exchange of threats is intensifying fears of a full-blown trade war between the world’s two largest economies. Markets dipped sharply as news of China’s plans emerged.

Experts said Beijing’s latest announcement could be an effort to push the United States into negotiating a deal to defuse the trade spat.

“The true purpose is not to escalate it to a trade war, but to demonstrate no weakness,” said Aidan Yao, an economist at fund management firm Axa Investment Managers.