WASHINGTON: US President Donald Trump has approved tariffs worth USD 50 billion on import of goods from China, a move that could escalate trade tensions between the world’s two largest economies.
A formal announcement is expected to be made by the US Trade Representatives today with a notification in the Federal Register in the coming weeks. The move is likely to attract retaliatory action by China.
Trump’s approval to impose tariffs on Chinese exports followed a 90-minute meeting he had with Commerce Secretary Wilbur Ross, Treasury Secretary Steven Mnuchin and US Trade Representatives Robert Lighthizer yesterday. The meeting also included representatives of the National Security Council.
China had previously said it would respond to American tariffs on USD 50 billion worth of Chinese exports with retaliatory tariffs on USD 50 billion of US products such as cars, planes and soybeans.
Trump’s first announced that the US would impose trade penalties on about USD 50 billion of Chinese goods in March.
After China warned it would retaliate, Trump threatened tariffs on a further USD 100 billion of Chinese products.
In mid-May, both sides announced a ceasefire after two rounds of trade negotiations. The countries said in a joint statement that China would “significantly increase” purchases of US agricultural and energy products to reduce the trade imbalance, a top Trump administration demand.
Ten days later, the White House abruptly said it would proceed with the tariffs.
A further round of trade talks in Beijing earlier this month failed to yield any breakthroughs.
Yesterday, China said it would not honor its pledge to increase purchases of US goods if tariffs were imposed.
Following the latest decision by Trump, Congresswoman Rosa DeLauro said tariffs must be seen as one tool among many the US could use to hold bad actors like China accountable and bring the Chinese government to the table to secure a more favourable balance of trade.
“We cannot allow the recent chaos to continue and risk further damage to our standing in the world. That is why I am calling on President Trump to fight for American jobs with a comprehensive strategy that puts American economic interests front and centre,” she said.
DeLauro said the Trump Commerce Department’s disorderly implementation of trade enforcement tools failed to inspire confidence in the President’s ability to appropriately hold the trading partners accountable.
Trump’s decision to move forward with tariffs on China follows his recent imposition of steep tariffs on steel and aluminium imports from Canada, Mexico and the European Union on national security grounds.