Trump makes good on threat - $200 billion in new tariffs on China

Glen Norman
July 11, 2018

The move marked the latest escalation of the ongoing trade war between Washington and Beijing.

More than 6,031 product lines are affected by the proposed tariffs, including seafood, fruits and vegetables, grains, tobacco, vehicle rearview mirrors and burglar alarms. "Given China's likelihood of retaliation, it's also billions worth of new tariffs on American exporters".

Consumer-goods companies have been bracing for months as the Trump administration steadily ramped up its rhetoric on trade with China and other major trade partners.

The list includes hundreds of food products as well as tobacco, coal, chemicals and tyres, dog and cat food, and consumer electronics.

Mr. Trump hit US$34-billion worth of Chinese imports with 25-per-cent tariffs starting last week, with another US$16-billion worth to be added shortly.


"The markets still remain sensitive to the trade-related theme, which is something investors have to take into account for the long term", said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management in Tokyo.

Prior to the first round of United States tariffs against China, UBS said negotiations between the two countries looked promising. Beijing immediately retaliated with similar duties on USA exports.

US Senate Finance Committe chairman Orrin Hatch labelled the move as "reckless", while the US retail industry leaders assocation immediately condemned the move, saying the "the President has broken his promise".

The U.S. Chamber of Commerce has supported Trump's domestic tax cuts and efforts to reduce regulation of businesses, but it has been critical of Trump's aggressive tariff policies.

"American families are the ones being punished".


The president has repeatedly described his resort to tariffs - which are paid by American importers - as a lever to extract negotiating concessions from USA trading partners.

Louis Kuijs, Hong Kong-based Head of Asia Economics at Oxford Economics, said while he expects China to strongly condemn the USA moves, its policy response is likely to be limited for now.

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 finalize, at which point Trump would decide whether to go ahead with the tariffs.

The earliest they would come into effect is September. Since then, the president has said his administration could impose duties on virtually all Chinese imports into the U.S.

Beijing has vowed to respond in kind to any USA trade action. "This new round of proposed tariffs takes the fight onto yet another level from which it is going to be hard for either side to make a graceful retreat", said Eswar Prasad, former head of the International Monetary Fund's China division.


Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER