You're tariffed! Trump unveils $US200B in tariffs on Chinese goods

Andrew Cummings
September 18, 2018

The Trump administration is giving American businesses a chance to adjust and look for alternative supply chains by delaying an increase of the tariff to 25 percent on January 1 for the $200 billion batch of Chinese goods, according to two senior administration officials who briefed reporters on Monday.

But Trump warned that "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".

Additional tariffs on $267 billion of imports from China would push the cumulative total beyond the amount of goods the US bought from the Asian nation a year ago.

On Monday morning, Trump defended his tariffs against China. He said the Trump administration regularly consults with Trump.

In an earlier round of tariffs on US$50 billion of goods, the Trump administration removed proposals on flat-panel television sets for the final list in June.

"If the United States launches any new tariff measures, China will have to take countermeasures to firmly ensure our legitimate rights and interests", foreign ministry spokesman Geng Shuang told reporters during a regular press briefing on Monday.

"We deeply regret this", said a Commerce Ministry statement.

The summary, released on Tuesday morning, quoted Zhong as saying "entrepreneurs are very anxious about the possible consequences of trade conflicts in the world's two largest economies, which we do not want to see". According to these experts, a large US trade deficit with China means that America is a wealthy country and American consumers can afford the most up-to-date devices.

A public comment period ended last week for the $200 billion tariff list, which included various internet technology products and other electronics, printed circuit boards, and consumer goods ranging from handbags to bicycles and furniture.

The KPMG modelling found Australia would be hit harder by the US-China trade war than the European Union or Japan. If China does retaliate, Trump threatened Monday to add a further $267 billion in Chinese imports to the target list.

United States and China officials had discussed a new round of talks over the past week, but Mr Trump's latest move is likely to sour relations further.

In the letter sent earlier this month, Apple said a range of its products would be hit and warned that the proposed tariffs, which could lead to higher production costs, higher consumer prices and "lower overall US economic growth, and other unintended economic consequences".

US President Donald Trump was poised to ratchet up his trade dispute with China, with a major announcement promised later Monday that could see hundreds of billions in goods subjected to fresh import duties.

The latest USA duties spared smart watches from Apple and Fitbit and other consumer products such as baby auto seats. I think that kind of tactic is not going to work with China.

Beijing has retaliated in kind, but some analysts and American businesses are concerned it could resort to other measures such as pressuring US companies operating in China.

This led to the Australian dollar rising modestly to 71.8 USA cents, amid a weaker greenback overnight.

Multiple reports in recent days cited officials saying Trump had chose to press ahead with new tariffs, but at a lower rate of 10 percent after initially announcing they should be hiked to 25 percent in light of China's alleged intransigence.

Chinese chemical inputs for manufacturing and textiles and agriculture eliminated from tariff list.

The Chinese government said last week it welcomed Washington's proposal for more talks, though neither side has given any indication it is willing to compromise. "And they can't take actions that entirely flout the rules of the worldwide trading system", the official said. Monday's announcement means almost half of all goods imported from China will be subject to tariffs.

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