President Trump has approved tariffs on $50billion worth of Chinese goods which could come into force today, it has been reported.
The White House will publish the list on Friday with tariffs to take effect ‘shortly’ afterwards, officials said.
The tariffs will target technology industries where China hopes to become a world leader, after an investigation uncovered rampant intellectual property theft by Chinese companies against US firms.
Donald Trump has approved tariffs on $50billion worth of Chinese goods, targeting technology industries where Beijing hopes to become a world leader
A list of 1,300 Chinese goods published in April, which included the likes of flamethrowers and false teeth, has now been whittled down to 800 and is due to be published on Friday
An initial list of 1,300 good published in April included items such as flamethrowers, false teeth, malaria testing kits and defibrillators, CNN reported.
The new list is believed to include 800 products, though it is not clear exactly which ones had been dropped.
News of the tariffs was initially reported by Bloomberg.
Beijing has threatened to impose tit-for-tat charges on US goods if Trump goes ahead, with cars, planes and soybeans believed to be on its list.
Chinese foreign ministry spokesman Geng Shuang said on Friday morning that his country would ‘respond quickly’ to any moves by the US.
Trump has already slapped tariffs on steel and aluminum imports from Canada, Mexico and the EU, all of which have threatened to retaliate in kind.
Renegotiating America’s trade deals to reduce deficits was a major promise of Trump’s presidential campaign.
But his proposed tariffs against China risk starting a trade war involving the world’s two biggest economies.
Sources said the new list will target technologies where China hopes to become a world leader. Included on the old list was parts for air conditioning units, which will likely be included
Microwaves and conventional ovens were also included on the previous list, and seem likely to be present this time around
A trade war could pose a risk to Trump’s peace talks in North Korea as America has been coordinating closely with Beijing.
China is one of North Korea’s closest allies and holds sway over Pyongyang because it accounts for roughly 80 per cent of North Korea’s foreign trade.
Trump, in his press conference in Singapore on Tuesday, said the U.S. has a ‘tremendous deficit in trade with China and we have to do something about it.’
The U.S. trade deficit with China was $336 billion in 2017.
Administration officials have signaled support for imposing the tariffs in a dispute over allegations that Beijing steals or pressures foreign companies to hand over technology, according to officials briefed on the plans.
Wall Street has viewed the escalating trade tensions with wariness, fearful that they could strangle the economic growth achieved during Trump’s watch and undermine the benefits of the tax cuts he signed into law last year.
“If you end up with a tariff battle, you will end up with price inflation, and you could end up with consumer debt,’ Gary Cohn, Trump’s former top economic adviser, said.
‘Those are all historic ingredients for an economic slowdown.’
Beijing has threatened to respond ‘quickly’ with tit-for-tat sanctions on American goods if Trump pushes ahead with his plans
Trump has already slapped steep tariffs on steel an aluminium imports from Mexico, Canada and the EU, prompting a furious response from Justin Trudeau
But Steve Bannon, Trump’s former White House and campaign adviser, said the crackdown on China’s trade practices was ‘the central part of Trump’s economic nationalist message.’
‘His fundamental commitment to the “deplorables” on the campaign trail was that he was going to bring manufacturing jobs back, particularly from Asia.’
In the trade fight, Bannon said, Trump has converted three major tools that ‘the American elites considered off the table’ – namely, the use of tariffs, the technology investigation of China and penalties on Chinese telecom giant ZTE.
‘That’s what has gotten us to the situation today where the Chinese are actually at the table,’ Bannon said. ‘It’s really not just tariffs, it’s tariffs on a scale never before considered.’
Trump officials have also drawn up a second list comprising an additional $100billion of Chinese goods that could be hit after the first round takes effect.
The $100 billion list will be subject to the same public comment and hearing process as the $50 billion list, so it could take 60 days or more to put into effect, three sources familiar with the Trump administration’s thinking told Reuters.
The list is intended to minimise the impact on U.S. consumers and businesses by selecting goods where there are ample alternative supplies from other countries. Eliminating any impact may be impossible.
Administration officials have been targeting products where China provides less than a third of total US imports to minimize the effect on consumers.
A Reuters analysis of U.S. Census Bureau import data in April showed that there were about 7,600 consumer and industrial goods still available for tariffs with a combined value of $101 billion in which China accounts for 40 per cent or less of US imports.
Another person familiar with the administration’s thinking said it could be difficult to reach $100 billion with a 33 per cent threshold.
Press officials at the U.S. Commerce Department and U.S. Trade Representative’s office declined to comment on the tariff list plans.