The United States today announced a fresh round of tariffs of up to 10 per cent on another $200 billion worth of Chinese imports into the country by September, escalating the trade war between the world’s two largest economies.
The US administration has identified an additional $200 billion in Chinese products, making good President Trump’s threat to target more Chinese products in response to China’s retaliatory action imposing tariffs on $34 billion worth of American goods (See: China hits back as US slaps duties on $34 bn worth of its goods).
The new list of goods that would face 10 per cent punitive duties includes frozen meats, live and fresh fish and seafood, butter, onions, garlic and other vegetables, fruits, nuts, metals, and a massive list of chemicals, as well as tyres, leather, fabrics, wood and papers.
US trade officials said they tried to target goods that would reduce the harm to US consumers.
For now, the USTR would work on the process of finalising an additional $16-billion in goods to face 25-per cent tariffs to bring the total up to $50 billion.
They also said they remain open to working with China to try to resolve the dispute, but the response from Beijing so far has been unsatisfactory.
The new US measure, announced after the initial 25 per cent tariffs on select high-tech Chinese goods went into effect on Friday, would eventually bring nearly half of all Chinese imports into US under new tariffs.
If the trump administration goes ahead with the tariff plan, it would mean thousands of products from fish to chemicals, metals and tyres facing new taxes.
Officials defended the White House’s earlier decision to impose tariffs on $50 billion worth of imports from China, saying it was meant to compensate the US economy of the harm caused by China’s unfair trading practices, including theft or forced transfer of American technology.
China has rebuffed US allegations and denied doing any harm to US companies and products, adding that China retaliated “without any international legal basis or justification,” US Trade Representative Robert Lighthizer said.
“As a result of China’s retaliation and failure to change its practices, the president has ordered USTR [US Trade Representative] to begin the process of imposing tariffs of 10 per cent on an additional $200 billion of Chinese imports,” he said in a statement.
USTR will hold hearings in late August on the list of targeted products, and an administration official said it would take about two months to finalise, at which point Trump would decide whether to go ahead with the tariffs.
US aims to bring up to 40 per cent of all imports from China under retaliatory tariffs as Chinese duty impost has hit an equal share of its exports to that country, a US official said in a conference call.
The US has confronted its allies and major trading partners, including Canada, Mexico and the European Union with steep tariffs on steel and aluminium, and those nations have also retaliated.
But the US has been especially concerned with Chinese threats as it happens to be America’s biggest trading partner.
China accused the US of starting “the largest trade war in economic history,” after the first round of tariffs took effect last week. But Trump has been steadfast in his accusation that China has taken advantage of the US economy. He had also vowed to hit nearly all the $450 billion worth of products that China exports to US with tariffs.
The US trade deficit in goods with China ballooned to a record $375.2 billion last year, stoking his anger over trade policies.
“For over a year, the Trump Administration has patiently urged China to stop its unfair practices, open its market, and engage in true market competition,” Lighthizer said. “Unfortunately, China has not changed its behaviour.” But he added that “the United States is willing to engage in efforts that could lead to a resolution of our concerns.”
