US announces import tax on $200 billion worth of Chinese goods

The White House has removed about 300 products from the list compared to the previous proposal. Included in the list of excluded products are smart watches, some chemicals and other products such as bicycle helmets and high chairs.

In a statement, Mr. Trump said the tariff would increase to 25% on January 1, 2019. He affirmed, “If China retaliates against our farmers or industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional goods.”

The new tax rate will take effect from September 24.

The US move has further strained trade relations between the world's two largest economies. Mr. Trump has complained about Chinese companies stealing intellectual property, as well as a large trade deficit with China, and wants to seek a new deal.

However, after many rounds of negotiations, the two sides have not made significant progress. “We have given them one chance after another. Right now, they are still very stubborn,” said a senior US government official.

Despite opposition from Republicans, Trump has defended his tariffs. Last night, he tweeted: “Tariffs have given the United States a tremendous negotiating advantage. Billions of dollars and jobs have flowed into our country. Prices have gone up very little. If a country doesn’t want to make a fair deal with us, they will be taxed.”

To date, the US has imposed import tariffs on $50 billion worth of Chinese goods and received similar retaliation. US officials have recently made efforts to restore negotiations between the two countries to ease tensions.

White House economic adviser Larry Kudlow said Mr Trump “is not satisfied with the talks with China on this issue”. However, last week, Mr Trump asserted that the US “is under no pressure to reach a deal”.

China also signaled yesterday that it would not negotiate if the US announced new tariffs. The country's Foreign Ministry said the government was ready to retaliate against US tariffs.