White House slaps 25% tariff on $50 billion worth of Chinese goods

Charlene Craig
June 1, 2018

President Donald Trump said Tuesday he is moving to finalize trade sanctions against China even as a U.S. delegation is set to travel to Beijing for talks to resolve the dispute.

The White House also said it plans to announce new measures to restrict Chinese investment "related to the acquisition of industrially significant technology" by 30 June.

The Trump Administration said it would move forward with plans to impose 25% tariffs on some $50 billion in Chinese-made goods, officials said Tuesday. The final tariff list will be made public by June 15 with the new import taxes taking effect shortly thereafter.

China pressed the U.S.to give ZTE a break after the Commerce Department cut off the company from USA suppliers to punish it for allegedly lying to American officials in a sanctions case.

In addition, it said, "The cost of China's intellectual property theft costs United States innovators billions of dollars a year, and China accounts for 87% of counterfeit goods seized coming into the United States".

"What we're having with China is a trade dispute, plain and simple", US National Trade Council Director Peter Navarro said, referring to Mnuchin's May 20 comment that trade action against China was "on hold".

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Washington postponed its tariff threat in mid-May after Beijing promised to significantly increase its purchases of US farm goods and energy products, such as natural gas.

A statement from the White House yesterday (29 May), said China has consistently taken advantage of the American economy with practices that undermine fair and reciprocal trade. Ross is expected to try and get China to agree to firm numbers to buy more USA goods during a June 2-4 visit to the Chinese capital.

FILE - U.S. Treasury Secretary Steven Mnuchin is seen as he and a U.S. delegation member for trade talks with China, leave a hotel in Beijing, China, May 3, 2018.

"Clearly, it will take more than vague promises to reduce the trade deficit with China", Oxford's Vanden Houten noted.

The moves up the ante for talks scheduled for this weekend, when Commerce Secretary Wilbur Ross will return to Beijing in an attempt to get trade talks back on track. "China imposes much higher tariffs on U.S. exports than the United States imposes on China", the White House complained. "We are very surprised by the White House statement".

The official said the instructions also stated that Chinese citizens seeking visas would need special clearance from multiple US agencies if they work as researchers or managers for companies on a US Commerce Department list of entities needing higher scrutiny.

USA threatens China with tariffs over alleged theft of trade secrets
The White House announcement said it also would impose curbs on Chinese investment and purchases of high-tech exports. China vows it will fight back if the United States goes through with plans to impose huge tariffs on Chinese goods.

This all made the USA force China to reconsider the taxes imposed on imports and reduce it quickly and avoid all practices that transfer the intellectual properties to the Chinese companies.

Tensions between the US and China may have been reduced somewhat by Trump's action last week to ease sanctions that threatened the viability of Chinese telecom giant ZTE, in response to a personal request from President Xi Jinping.

"Trade tensions between the United States and China, particularly those surrounding the Section 232 and 301 investigations, have raised serious concerns that such tensions will escalate into a trade war", it said.

But when Trump subsequently said he would ease penalties against ZTE in order to save Chinese jobs, this drew a sharp backlash from his supporters.

The tariff threat could still disrupt Ross's China talks.

Either way, repeated changes to the United States strategy on China may only bog down talks with Beijing moving forward, Reinsch said.

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