Trade War Intensifies as China Files Complaint with WTO against U.S over Steel Tariffs

There seems to be no end to the trade war between two major economies U.S. and China which was sparked after the Trump government announcement of steep import tariffs on steel and aluminium in the first week of Mar'18 in which although six of its trade allies were given temporary exemption, China was not included in the list.

Now a new update has come that China has filed a complaint with WTO (World Trade Organisation) objecting Trump government's announcement of steep tariffs imposition on steel and aluminum and that China has responded with a trade complaint in order to defend itself.

If we look at the sequence of events that has happened, after the tariffs announcement were made by U.S., China imposed USD 3 billion tariffs on 128 products exported by U.S. to China. Following this, the U.S. administration announced its plans to apply 25% tariffs on Chinese goods worth USD 50 billion including software, patents, and technology and subsequently China retaliated quite harshly by announcing 25% tariffs on additional 106 U.S. products exported to China.

According to WTO, China has requested 60 days of consultations with the U.S on the steel and aluminum dispute failing which the next step could be for Beijing to request a ruling (an official or authoritative decision) from a panel of trade experts. In its complaint, China has said that the Trump's decision of such steep import tariffs is a violation of international trade rules.

U.S. has announced trade restrictions on imports of steel and aluminum citing that in case of China, its steel supply exceeds demand which has resulted in the dumping of lower quality and cheaper steel products into the country. As the Trump administration's agenda is 'America First', the country made stricter tariff announcements so that its domestic steel sector can get a boost.

Although China's contribution in U.S. total steel imports stood at around 2% in 2017, steel tariffs are just a part of U.S.'s bigger plans to hurt China's ambitious industrial policy for the leadership of the global economy.