China options limited counter USA proposed tariffs

China options limited to counter US’ proposed tariffs – analysts   China options limited counter USA proposed tariffs 

 Source:ICIS News

SINGAPORE (ICIS)–China has limited options to respond to the US’ planned tariffs on as much as $500bn additional Chinese goods, and may have to resort to non-tariff countermeasures on what the Asian powerhouse deemed as “trade bullying”.

China has vowed to adopt a tit-for-tat approach on any trade barrier that the US will put up.China options limited counter USA proposed tariffs 

The first shots in the US-China trade war were fired on 6 July, when the US implemented 25% tariffs on $34bn worth of Chinese imports, prompting a similar response from China.

The trade war between the world’s two economic giants escalated as the US on 10 July threatened to slap 10% tariffs on additional $200bn worth of Chinese goods, including key chemical feedstocks such as naphtha and ethane.China options limited counter USA proposed tariffs 

“The key uncertainty now is how China will respond to [US President Donald] Trump’s latest ‘tit’,” Singapore-based UOB Global Economics & Markets Research.

“The Chinese has significantly less room to match US’ actions like-for-like as China’s total imports from the US were less than the additional amount of $200bn goods that is targeted for the 10% tariff,” it said in a note.

In 2017, China’s total imports from the US stood at $130bn, while US’ imports of Chinese goods and services totaled around $500bn.China options limited counter USA proposed tariffs 

China options limited counter USA proposed tariffs
China options limited counter USA proposed tariffs

Japan-based Nomura Global Economic Research expects the US’ latest tariffs to take effect around 15 October, after the two-month public review of the list and the slated August hearings are completed.China options limited counter USA proposed tariffs 

“After a relatively calm weekend following the initial round of US tariffs and China’s response on 6 July, we view this as a significant escalation in the US-China trade dispute,” it said.China options limited counter USA proposed tariffs 

Given that the new list has an amount bigger than the US’ actual exports to China in 2017, Beijing could hit $100bn of US products with a higher tariff rate of 20% in response, Nomura said.China options limited counter USA proposed tariffs 

“However, China could also respond by resorting to non-tariff barriers,” it said without elaborating.China options limited counter USA proposed tariffs 

Trump, however, intends to impose tariffs on up to $500bn worth of Chinese goods, with the value possibly exceeding its actual Chinese imports in 2017.

The US’ planned tariffs were meant to reduce the US’ $370bn trade deficit with China.

Based on official data, the US accounted for more than a fifth of China’s overall exports of $2.26tr last year.China options limited counter USA proposed tariffs 

Building a wall of tariffs against each other could hit domestic consumption hard as it would translate to higher prices of affected goods, and has a strong potential to slow down economic expansion.

“While there still remains hope for some resolution instead of further spiraling trade measures, the outlook has become more uncertain,” UOB said.

The US’ initial round of tariffs, targeting $50bn of Chinese imports, was primarily on capital goods, while the new list involving $200bn worth of goods, is almost equally split between capital and consumer goods, Nomura said.China options limited counter USA proposed tariffs 

Machinery and electrical equipment remains the most heavily targeted group, consistent with the Trump administration’s approach of taking aim at certain machinery and electrical equipment outlined in Beijing’s “Made in China 2025” plan.

In response, China may opt to curtail US service exports to the country. These include tourism, education and banking services which are worth more than $50bn per year, and the US currently enjoys a surplus with China on this segment, UOB said.

“We maintain our view that the full impact of the trade actions will likely be felt only in 2019 and will remain watchful of the trade numbers in the coming months to assess the potential impact on 2018 growth,” it said in a note.China options limited counter USA proposed tariffs 

China’s GDP growth had steadily slowed down over six years from 2011. The world’s second biggest economy surprised with a stronger growth of 6.9% in 2017, but is projected to post a weaker growth of around 6.5% this year.

The growth projection was made before the trade war started.

The US economy, on the other hand, is on its second year of accelerating growth.

The International Monetary Fund (IMF), in its April World Economic Outlook report, forecast a 2.9% growth for the world’s biggest economy this year from 2.3% in 2017.

Additional reporting by Joey Chua

By Nurluqman Suratman
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Lenzing invests EUR 100 million sustainable production technology

Lenzing invests EUR 100 million in sustainable production technology    Lenzing invests EUR 100 million sustainable production technology

Lenzing invests EUR 100 million sustainable production technology

The Lenzing Group, a producer of botanic fibres from wood, is expanding its environmental leadership commitment.Lenzing invests EUR 100 million sustainable production technology

As a leader in wood-based cellulosic fibres, Lenzing says it has ambition to help raising the bar in sustainability in the textiles and nonwovens industries.

To fulfil this vision, Lenzing is investing more than EUR 100 million in sustainable manufacturing technologies and production facilities until 2022.

In order to further extend the company’s environmental leadership, a major part of this investment will focus on closed loop production technologies for the expansion of the sulphur recovery systems.Lenzing invests EUR 100 million sustainable production technology

The second area of investment will be in improving the effluent treatment units. In addition, Lenzing will upgrade its energy usage to more sustainable solutions reducing its greenhouse gas emissions due to the construction of a gas boiler at its site in China.

This investment strengthens Lenzing’s sustainability leadership at its viscose facility in Nanjing. Lenzing invests EUR 100 million sustainable production technology

The investments underline Lenzing’s commitment to the United Nations Sustainable Development Goals (SDG) as guiding principles for its sustainability agenda. One of the most significant SDGs for the company is SDG 12: Responsible production and consumption, says Stefan Doboczky, CEO.

“The textiles and the nonwoven industries face fundamental challenges related to sustainability. Lenzing is passionate to take a leadership role in addressing this and making the world a better place. Lenzing invests EUR 100 million sustainable production technology

Our holistic approach to sustainability underpins this scope. The new eco-investment programme is a major step forward in our ambitions,” he explained.

www.lenzing.com

Source : Author: Knitting Industry

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Teijin groundbreaking ceremony second USA carbon fibre plant

Groundbreaking ceremony for second US carbon fibre plant    Teijin groundbreaking ceremony second USA carbon fibre plant
Teijin groundbreaking ceremony second USA carbon fibre plant

The groundbreaking ceremony in Greenwood (Photo: Teijin Carbon Fibers)

Plastics and carbon fibre specialist Teijin (Tokyo / Japan; www.teijin.com) has begun construction of its new carbon fibre production plant in Greenwood, South Carolina / USA, after acquiring property there in late 2016 – see Plasteurope.com of 15.11.2016.

Its US carbon fibre subsidiary Teijin Carbon Fibers was founded in March 2018, and the plans are to start operations in Greenwood in 2020.

Around USD 600m (EUR 510m) will be invested in various production and downstream facilities by 2030.Teijin groundbreaking ceremony second USA carbon fibre plant

Teijin did not disclose the capacity of the facility. Greenwood will be Teijin’s second production plant in the US, along with its site in Rockwood, Tennessee.
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Brent WTI Prices Slide Oversupply Concerns

Brent, WTI Prices Slide on Oversupply Concerns   Brent WTI Prices Slide Oversupply Concerns
Brent WTI Prices Slide Oversupply Concerns

Oil prices fell on Friday as markets digested big swings earlier in the week that have left both major benchmarks facing a second weekly loss and largely shrugged off a warning about tightness in spare capacity.Brent WTI Prices Slide Oversupply Concerns

Brent crude dropped 35 cents, or 0.5%, to $74.10 a barrel. On Thursday it gained $1.05 a barrel, rebounding from a session low of $72.67. It is heading for a weekly fall of nearly 4%, CNBC reported.Brent WTI Prices Slide Oversupply Concerns

US benchmark West Texas Intermediate crude edged down 12 cents to $70.21 a barrel, after falling 5 cents in the previous session. It is heading for a weekly decline of nearly 5%.Brent WTI Prices Slide Oversupply Concerns

It has been a wild week for oil prices with both the main benchmarks suffering heavy losses on Wednesday, as traders focused on the return of Libyan oil to the market amid concerns about a China-US trade war.Brent WTI Prices Slide Oversupply Concerns

However, a warning on spare capacity by the International Energy Agency pushed Brent higher on Thursday, helping it recoup some losses.Brent WTI Prices Slide Oversupply Concerns

“It is a tough market,” said Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo. “I think it is supported by relatively strong demand and inventories are falling, but if you look a little bit ahead, US shale oil just continues to grow and then it depends on what goes on with OPEC.”

The Organization of Petroleum Exporting Countries and other key producers, including Russia have responded to the recent market tightness by easing a supply-cut agreement.

IEA cautioned that the world’s oil supply cushion “might be stretched to the limit” due to production losses in several countries.

The Paris-based IEA said in its monthly report that rising production from Middle East Persian Gulf countries and Russia comes at the expense of the world’s spare capacity cushion, which might be stretched to the limit.

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