President Imposes New Tariffs on $200 Billion More in Chinese Goods09/18/2018
President Donald Trump late Monday announced new 10% tariffs on roughly $200 billion in goods from China effective Sept. 24. The tariffs will increase to 25% on Jan. 1.
In a statement, the president added, “Further, if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports.”
Trump reiterated his administration’s actions come after the U.S. Trade Representative “concluded that China is engaged in numerous unfair policies and practices relating to United States technology and intellectual property — such as forcing United States companies to transfer technology to Chinese counterparts. These practices plainly constitute a grave threat to the long-term health and prosperity of the United States economy.”
The president said China has been unwilling to change its practices, which sparked the first round of 25% tariffs on $50 billion in Chinese imports that the U.S. imposed earlier this summer.
“As president, it is my duty to protect the interests of working men and women, farmers, ranchers, businesses, and our country itself,” Trump stated. “My Administration will not remain idle when those interests are under attack.”
Trump then added he hopes the trade situation would be resolved, “by myself and President Xi of China, for whom I have great respect and affection.”
In anticipation of Monday’s announcement, Trump tweeted early Monday, “Tariffs have put the U.S. in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country – and yet cost increases have thus far been almost unnoticeable. If countries will not make fair deals with us, they will be ‘Tariffed!'”
There was no immediate response Monday evening from Chinese officials. A Foreign Ministry spokesman commented before Monday’s tariffs were announced that China would respond if more tariffs were placed on Chinese goods.
Foreign Ministry Spokesperson Geng Shuang said Monday, “Firstly, if the U.S. imposes any additional tariffs on China, we will have to take necessary countermeasures and resolutely safeguard our legitimate and legal rights and interests. Secondly, the escalating trade disputes serve the interests of neither side. We always believe that dialogue and consultation on the basis of equality, good faith and mutual respect make the only viable way out for the China-U.S. trade issues.”
White House adviser Larry Kudlow said on CNBC Monday that Trump has not been satisfied by recent talks with China. Kudlow also alluded to the confidence in the overall U.S. economy right now.
“The big story here is the change in policies and the economic boom,” Kudlow said.
Still, the tariff battle has translated into $4.7 billion in direct aid payments to farmers this fall because of lost exports, especially for commodities such as soybeans, pork and sorghum, but USDA has created three separate programs to help farmers and agricultural exporters. The White House authorized USDA to provide up to $12 billion in aid programs for farmers.
The U.S. Trade Representative’s Office stated the list of Chinese goods includes 5,745 lines of products. The U.S. dropped proposed tariffs on some consumer electronics products such as smart watches and Bluetooth devices. Other products the U.S. dropped from the list included certain chemical inputs for manufactured goods, textiles and agriculture; certain health and safety products, such as bicycle helmets; and child safety furniture, such as car seats and playpens.
However, the list released by USTR still included putting 10% tariffs on an array of seafood products, poultry products, vegetables, fruits and nuts from China, as well as a long list of industrial chemicals.
Chris Clayton can be reached at Chris.Clayton@dtn.com
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Source: Chris Clayton, DTN