China unveils new tariff exemptions on US products

China on Tuesday announced that a new batch of imported products from the US will be excluded from punitive tariffs. The move came just days after the US released a tariff exemption list for imported products from China.

Products on the list – 79 items including rareearth ore, gold ore and medical disinfectant – will no longer be subject to additional tariffs from May 19, 2020 to May 18, 2021, read a statement from the Customs Tariff Commission of the State Council, China's cabinet.

High-technology products like heater resistors and radar equipment for navigation were also included on the exemption list.

Imports from the US previously faced additional tariffs in retaliation for the US' Section 301 investigation covering Chinese imports.

Tariff exemptions on both sides, though not part of the phase one trade deal, were coordinated moves aimed at easing pressure on specific industries and companies in both countries, which have an interdependent trade relationship, experts said.

The latest exemptions also pave the way for higher mutual imports, they said.

China released its first list of goods that were exempted from the second round of additional tariffs in February. Products on the list included high-tech medical appliances such as gene-sequencing machines and aircraft autopilot system parts.

The bilateral tariff exclusions come as the world's two largest economies have been pushing forward the implementation of the phase one trade deal despite the COVID-19 pandemic.

“The China-US phase one trade deal benefits China and the US, as well as the world. Both China and the US should uphold the principles of equality and mutual respect and jointly implement the agreement,” Chinese Foreign Ministry spokesman Zhao Lijian told a regular press briefing on Thursday.

Gao Lingyun, an expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times that both China and US may face difficulties carrying out the trade deal because of the pandemic. China may have delayed purchases of some US goods in the first quarter, while the US' ability to supply products to China has been constrained by the virus.

“Based on the changing situation, we can revise purchase categories and procedures to achieve the final purchase goal,” said Gao.