Trump eyes China for shift on USA agricultural product purchases

Andrew Cummings
August 13, 2019

The Office of the U.S. Trade Representative announced on Tuesday that 10% tariffs on Chinese imports set to take effect on cellphones, laptop computers, video game consoles, certain toys, computer monitors and some shoes and clothing will now be postponed until December 15.

The USTR plans to publish a full list of the products later Tuesday.

The decision came less than two weeks after President Donald Trump said on August 1 he would impose a 10 per cent tariff on $300-billion of Chinese goods, blaming China for not following through on promises to buy more American agricultural products.

The broader S&P 500 was up by roughly the same amount in percentage terms, while the tech-heavy Nasdaq fared even better, up 185 points or 2.35 per cent to 8,050.

As news of the tariff delay broke, Donald Trump used Twitter to complain that China had not followed through with expected large purchases of United States agricultural products.

But the agency said it would delay tariffs to 15 December on some goods, including cellphones, laptops, video game consoles, some toys, computer monitors, shoes and clothing. "Maybe this will be different!" However, the United States Trade Representative (USTR) said Tuesday that some electronic devices made in China are getting a delay and other items have been removed from the tariff lists altogether. It will remove other items from the list based "on health, safety, national security and other factors". Most of the levies are scheduled to kick in September 1.

Wall Street's main indexes had initially opened lower, adding to a global slide in stocks due to geopolitical concerns, with a Labor Department report also showing the core consumer price index rose 2.2 per cent in the 12 months through July.

The Dow Jones Industrial Average was up almost 500 points in early trading. Goldman Sachs said on Sunday that fears of the US-China trade war leading to a recession were increasing. Since the iPhone is designed in the US but assembled in China, it is considered an import from that country and is subject to the tariffs.

Cell phones, laptop and tablet computers, toys and video game controllers were among the top four product categories in the proposed $300 billion list of products targeted by the latest 10% tariff.

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