This is just one example, but, there are others such as baby formula that causes me to wonder what China is thinking.
I think if they want to instill tariffs, it probably is a good idea, but, I think in some instances it might backfire.
April 2, 2018
By Joe McDonald
Beijing — China raised import duties on a $3 billion (click here) list of U.S. pork, apples and other products Monday in an escalating dispute with Washington over trade and industrial policy.
The government of President Xi Jinping said it was responding to a U.S. tariff hike on steel and aluminum. But that is just one facet of sprawling tensions with Washington, Europe and Japan over a state-led economic model they complain hampers market access, protects Chinese companies and subsidizes exports in violation of Beijing’s free-trade commitments.
Already, companies are looking ahead to a bigger fight over U.S. President Donald Trump’s approval of higher duties on up to $50 billion of Chinese goods in response to complaints that Beijing steals or pressures foreign companies to hand over technology.
Forecasters say the impact of Monday’s move should be limited, but investors worry the global recovery might be set back if other governments respond by raising import barriers.
On Monday, the main stock market indexes in Tokyo and Shanghai ended the day down.
The tariffs “signal a most unwelcome development, which is that countries are becoming protectionist,” said economist Taimur Baig of DBS Group. But in commercial terms, they are “not very substantial” compared with China’s $150 billion in annual imports of U.S. goods, he said....
China has a problem. It has more than a billion people to feed on any given day. Some of its food sources soured over the past decade and pork is one of them. A chinese oligarch bought out Smithfield Foods for the purpose of sending the pork back to China. The pig farms owned by Shuanghul here in the USA are not for the American market, so if China imposes tariffs against pork, it is penalizing it's own businesses and consumers.
It could be a deterrent for Chinese businesspersons moving to the USA as Shuanghul did in this case. In the case of baby food, China has begun it's own version of the US FDA and producers of these important products are now under regulation to provide the Chinese parents peace of mind in feeding their infants.
I disagree the tariffs will hurt the American farmer because they don't ship to China directly, that is all handled by wholesalers and exporters. The cost to the export market will be according to market value. Pork is a commodity. So, the idea the American farmer will be hurt by such tariffs is not the case exactly.
When American pork reaches Chinese shores, the cost will go up because of the tariffs, but, it will be the Chinese people that will either pay a higher price for pork or make other choices. The Chinese people are caught between a rock and a hard place in regard to this product. They may pay the higher price due to the tariffs just because it is a better and edible product.
President Xi Jinping needs to look into all the dynamics of the products he is placing a tariff on. He is correct to answer the Trump tariffs with Chinese tariffs, but, his choices should be reviewed under a finer microscope before imposing them.
It is just the way it is. China hasn't yet developed a full compliment of marketable items that are made in China. The products produced in China may not be the quality of the imports either. This is not an easy time for President Xi Jinping. He wants to answer the US tariffs to place perspective in the hands of American consumers to decide against the tarrifs and perhaps change an election, however, it is not as easy for China to pivot to such strategies because it is still a developing economy.
Perhaps, China needs to invest in domestic products most widely used and currently imported. When the USA decides it needs an expansion in a domestically produced product, it provides grants and low cost loans to entrepreneurs with specifications as to the product to be developed or moved into domestic production. China can do the same thing. It has schools to educate it's children with good success. There is no reason to believe China is trapped in only importing it's economy. The contrary is true; with the correct incentives and government involvement China could develop a domestic market that pleases it's people in the same way exports currently do now.
