Trump to im­pose more tari≠s on China’s goods

The Washington Post Sunday - - POLITICS & THE NATION - BY DAMIAN PALETTA AND DAVID J. LYNCH damian.paletta@wash­post.com david.lynch@wash­post.com

Pres­i­dent Trump has de­cided to im­pose tar­iffs on $200 bil­lion worth of Chi­nese goods, two peo­ple briefed on the de­ci­sion said, one of the most se­vere eco­nomic re­stric­tions ever im­posed by a U.S. pres­i­dent.

An an­nounce­ment is ex­pected to come within days, the peo­ple said, speak­ing on the con­di­tion of anonymity be­cause they were not au­tho­rized to dis­cuss in­ter­nal plans.

The new tar­iffs would ap­ply to more than 1,000 prod­ucts, in­clud­ing re­frig­er­a­tors, air con­di­tion­ers, fur­ni­ture, tele­vi­sions and toys. Th­ese penal­ties could drive up the cost of a range of prod­ucts ahead of the hol­i­day shop­ping season, though it’s un­clear how much.

Trump has or­dered aides to set the tar­iffs at 10 per­cent, which is likely to lead to higher prices for Amer­i­can con­sumers. The tar­iffs are paid by U.S. com­pa­nies that im­port the prod­ucts, and the com­pa­nies are likely to pass the costs along to U.S. con­sumers in the form of higher prices.

The United States im­ports roughly $500 bil­lion worth of Chi­nese goods each year, and — com­bined with ex­ist­ing tar­iffs — th­ese new penal­ties would cover half of all goods sent to the United States from China.

The 10 per­cent tar­iff was scaled back from Trump’s ini­tial plan to im­pose 25 per­cent penal­ties on all of th­ese im­ports. But the im­pact is still likely to be felt by mil­lions of Amer­i­can con­sumers.

A White House spokesman did not im­me­di­ately re­spond to a re­quest for com­ment Satur­day af­ter­noon.

On Fri­day, deputy White House press sec­re­tary Lind­say Wal­ters said: “The pres­i­dent has been clear that he and his ad­min­is­tra­tion will con­tinue to take ac­tion to ad­dress China’s un­fair trade prac­tices. We en­cour­age China to ad­dress the long-stand­ing con­cerns raised by the United States.”

Trump’s top ad­vis­ers have been united be­hind his ef­fort to push China to change its eco­nomic prac­tices, but they have been divided on his tac­tics. Some have ad­vo­cated a more cau­tious, diplo­matic ap­proach.

But Trump has sig­naled that he thinks only the threat of real eco­nomic pain will push Bei­jing to make ma­jor changes. He re­cently boasted that he thinks China’s econ­omy is suf­fer­ing be­cause of his tough poli­cies.

Trump has ac­cused China of a num­ber of un­fair trade prac­tices. He wants China to take steps in­clud­ing buy­ing more Amer­i­can prod­ucts, open­ing it­self up to more U.S. in­vest­ment and end­ing what he says is its theft of U.S. in­tel­lec­tual prop­erty.

The tar­iffs come as a num­ber of top White House ad­vis­ers have been try­ing to de-es­ca­late ten­sions be­tween Trump and Chi­nese Pres­i­dent Xi Jin­ping. Trea­sury Sec­re­tary Steven Mnuchin was plan­ning to restart talks with China soon.

Chi­nese lead­ers have vowed to re­tal­i­ate against any es­ca­la­tion of the trade bat­tle with puni­tive steps of their own, and Trump’s move could fur­ther push Bei­jing to­ward such ac­tion.

Trump’s de­ci­sion was first re­ported by the Wall Street Jour­nal.

Trump first im­posed tar­iffs on roughly $50 bil­lion in Chi­nese prod­ucts this sum­mer. The list of prod­ucts mostly in­cluded in­dus­trial equip­ment to avoid directly hurt­ing U.S. con­sumers.

China re­sponded by im­pos­ing tar­iffs on U.S. prod­ucts such as beef and soy­beans, a re­sponse that spooked the U.S. agri­cul­ture in­dus­try and an­gered Trump and other White House of­fi­cials. Trump or­dered his ad­vis­ers to come up with a list of $200 bil­lion of other Chi­nese prod­ucts to pe­nal­ize, a pack­age that in­cludes many con­sumer prod­ucts.

And two weeks ago, he said he was prepar­ing a third pack­age of penal­ties on what he said would be $267 bil­lion of ad­di­tional items, a list that is likely to en­com­pass all re­main­ing goods pro­duced in China.

“For the near term, this com­bi­na­tion of tac­tics seems to sig­nal that un­less and un­til China comes to the ta­ble with sig­nif­i­cant ac­tions on the is­sues the U.S. is ham­mer­ing, the U.S. will keep tar­iff pres­sure go­ing,” said Claire Reade, a for­mer U.S. trade ne­go­tia­tor. “The open ques­tion, of course, is: How much ac­tion is enough, and can China find a way to move that will be seen as be­ing in its own in­ter­est, not kow­tow­ing to the U.S.?”

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