China slashes tariffs for Asian countries as US trade fight escalates


Beijing will reduce tariffs on thousands of products from India and South Korea, as well as the smaller economies of Sri Lanka, Bangladesh and Laos, China’s commerce ministry said Thursday.

The reductions are due to take effect on July 1. They’re part of an agreement between the six countries called the Asia Pacific Trade Agreement (APTA) that covers more than 10,000 goods in total, the ministry added.

China has identified more than 8,500 goods from the five countries on which it will “reduce or cancel tariffs,” China’s Ambassador to India Luo Zhaohui said on Twitter. They include soybeans, steel, aluminum as well as other agricultural and chemical products, he added.

Many of those products could help replace imports from the United States that will become more expensive in China if the two countries go ahead with tariffs on $34 billion of each other’s exports next week.

Although the Asian trade agreement was planned before the US-China dispute escalated, some experts say Beijing is highlighting it now to send a message to the White House.

“This is basically a tactical measure to counter the Trump administration’s tariff rise,” said Srikanth Kondapalli, a professor of Chinese studies at New Delhi’s Jawaharlal Nehru University. “They are trying to tap into other markets if the United States goes ahead with a trade war,” he added.

The trade in soybeans is particularly important for both sides. Soybeans are America’s leading agricultural export and China is its biggest customer, buying them from US farmers to use as a protein source in animal feed.

China plans to hit American soybeans with a 25% tariff in response for planned US tariffs on Chinese goods.