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Trump’s latest tariffs on China begin to bite
WASHINGTON, Sept 24, 2018 (BSS/AFP) – President Donald Trump’s latest
round of punitive tariffs on China took effect on Monday, adding $200 billion
in Chinese imports to the escalating trade war that is clouding the global
economic horizon.
The new attack on Beijing brings the amount of goods hit by duties to more
than $250 billion, roughly half of Chinese exports to the United States, and
increasingly consumers will feel the pain in their wallets directly.
Trump has hit 12 percent of total US imports this year alone.
Defiant in the face of increasing fears about the impact to the US
economy, Trump has threatened to go after 100 percent of imports from China
if the country refuses to change policies he says harm US industry,
particularly the theft of American technology.
“These practices plainly constitute a grave threat to the long-term health
and prosperity of the United States economy,” he said in announcing the
tariffs last week.
“We are going to win it,” his Secretary of State Mike Pompeo told “Fox
News Sunday.”
“We’re going to get an outcome which forces China to behave in a way that
if you want to be a power — a global power — transparency, rule of law, you
don’t steal intellectual property.”
Beijing has promised to strike back on Monday with duties on $60 billion
in American goods, bringing the total to $110 billion, nearly everything
China buys from the United States.
But Trump warned he could ramp up to “phase three,” slapping tariffs on
approximately $267 billion of additional imports, or the entirety of the
goods the US buys from China.
Dialogue between the world’s two biggest economies appears severed.
Beijing cancelled the visit of a Chinese negotiating team expected September
27-28 in Washington, The Wall Street Journal said.
Previous talks in late August were ineffective.
In that context, the International Monetary Fund has warned about the
potential for “significant economic costs,” including slower growth.
MORE/HR/1038
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“Should the escalation go further, the economic costs for both countries
and around the world will quickly add up,” IMF spokesman Gerry Rice said last
week.
Meanwhile, Fitch Ratings has cut its growth estimates for China and the
world for 2019.
“Protectionist US trade policies have now reached the point where they are
materially affecting what remains a strong global growth outlook,” Fitch said
in a report Friday.
– Hit list –
The latest round of Chinese imports will face 10 percent tariffs through
the end of the year, and then the rate will jump to 25 percent.
A broad swath of products are on the hit list, including billions in
Chinese-made voice data receivers, computer memory modules, automatic data
processors, and accessories for office equipment such as copiers and banknote
dispensers — instantly making widely used goods more expensive.
However, following complaints from thousands of US firms — including
powerhouses like Apple and Walmart — 300 product lines were dropped from the
target list.
The products spared also include smartwatches and Bluetooth devices, like
the iPhone and Fitbit, child safety products such as high chairs, car seats
and playpens, and certain health-and-safety products such as bicycle helmets,
US officials said.
The removal of smartwatches and wireless headphones represents a win for
tech giant Apple, just days after it unveiled its latest smartwatch and three
new iPhones as part of a bid to fight back after slipping to third place
among smartphone makers.
Walmart, the world’s biggest retailer, also warned of the “detrimental
impact” to consumers if tariffs were imposed on a number of products, but
many of those, like handbags, suitcases, haircare products, dog food and dog
leashes, remained on the final list.
BSS/AFP/HR/1040