23 July 2019
Donald Trump has escalated a trade war with Beijing by announcing new tariffs on US$200 billion worth of Chinese goods. Photo: Reuters
Donald Trump has escalated a trade war with Beijing by announcing new tariffs on US$200 billion worth of Chinese goods. Photo: Reuters

Trump announces new round of tariffs on Chinese goods

US President Donald Trump announced on Monday that he will impose 10 percent tariffs on about US$200 billion worth of Chinese imports, escalating a trade war with Beijing.

However, he spared some consumer products, including smart watches from Apple and Fitbit and items such as bicycle helmets and baby car seats, in the new round of tariffs, Reuters reports.

Unveiling the new duties, Trump warned that if China takes retaliatory action against US farmers or industries, “we will immediately pursue phase three,” which would involve tariffs on another US$267 billion of Chinese imports.

Collection of tariffs on the long-anticipated list will start September 24 and the rate will increase to 25 percent by the end of 2018, allowing US companies some time to adjust their supply chains to alternate countries, Reuters quoted a senior Trump administration official as saying.

Prior to the latest move, Washington had imposed tariffs on US$50 billion worth of Chinese products to pressure China to make sweeping changes to its trade, technology transfer and high-tech industrial subsidy policies.

The escalation of Trump’s tariffs on China comes after talks between the world’s two largest economies to resolve their trade differences have produced no results.

US Treasury Secretary Steven Mnuchin last week invited top Chinese officials to a new round of talks, but thus far nothing has been scheduled.

A senior Trump administration official told reporters that the US is open to further talks with Beijing, but offered no immediate details on when any new meetings may occur.

“This is not an effort to constrain China, but this is an effort to work with China and say, ‘It’s time you address these unfair trade practices that we’ve identified that others have identified and that have harmed the entire trading system,’” the official said.

China has vowed to retaliate further against any new US tariffs, with state-run media arguing for an aggressive “counterattack.”

The US Trade Representative’s office eliminated about 300 product categories from the proposed tariff list, along with some subsets of other categories, but administration officials said the total value of the revised list would still be approximately US$200 billion.

A broad US$23 billion category of internet-connected devices will remain subject to tariffs, but some products, such as smart watches, Bluetooth devices, and other consumer-focused technology products were removed following a lengthy public vetting period during which more than 6,000 comments were received, Reuters said in its report.

Also spared from the tariffs were Chinese inputs for US-produced chemicals used in manufacturing, textiles and agriculture.

Consumer safety products made in China, such as bicycle helmets sold by Vista Outdoor and baby car seats and other products from Graco also were taken off the list.

But the adjustments did little to appease technology and retail groups who argued that the tariffs would hit consumers hard.

“President Trump’s decision to impose an additional $200 billion is reckless and will create lasting harm to communities across the country,” said Dean Garfield, president of the Information Technology Industry Council, which represents major tech firms.

The Retail Industry Leaders Association (RLIA) pointed out that the new tariffs would still hit more than US$1 billion worth of gas grills from China, US$843 million worth of luggage and travel bags, US$825 million worth of mattresses, and US$1.9 billion worth of vacuum cleaners.

“Tariffs are a tax on American families, period,” said Hun Quach, RILA’s vice president for international trade. “Consumers – not China – will bear the brunt of these tariffs and American farmers and ranchers will see the harmful effects of retaliation worsen.”

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