Collection of tariffs on the long-anticipated list will start September 24 but the rate will increase to 25 percent by the end of 2018, allowing USA companies some time to adjust their supply chains to alternate countries, a senior administration official said.
The latest US move could generate a tit-for-tat response from Beijing, which has said it would welcome new trade talks with Washington, but also suggested it would not engage in more negotiations if the USA imposed the tariffs. The action would bring the total amount of Chinese products subject to duties to $250 billion, roughly half of the amount the U.S. imported from that country in 2017.
If China does retaliate, Trump threatened Monday to add a further $267 billion in Chinese imports to the target list.
The lira fell 1.1 percent to 6.2369 TRY= while Russia's rouble dropped 0.2 percent to 68.146 RUB= as the effect of the Russian central bank rate rise on Friday faded.
It may also cancel planned trade talks in Washington next week as a result of the latest move by Washington, according to a government source. Mark Vena, an analyst with technology research firm Moor Insights & Strategy, told the Wall Street Journal today that Apple has the inventory of key components for products, like the iPhone, to get through the holiday but the threats of retaliation by China "could be a serious problem" later on.
After a public comment period, the administration said Monday that it had withdrawn some items from its preliminary list of $200 billion in Chinese imports to be taxed, including child-safety products like bicycle helmets.
Trump Imposes $200 Billion in New Tariffs on Chinese Goods
Beijing has warned that it would hit an additional $60 billion in American goods if Trump ordered more tariffs. FILE PHOTO: A worker places U.S. and China flags near the Forbidden City ahead of a visit by U.S.
Beijing says it will retaliate if the United States goes ahead with these tariffs, and there is a risk it may cancel their upcoming trade talks.
Turkey has in turn hiked tariffs on imports of several USA products such as rice, alcohol, leaf tobacco, cosmetics and cars. US Treasury Secretary Steven Mnuchin last week invited top Chinese officials to a new round of talks, but thus far nothing has been scheduled. Beijing pushed back, slapping tariffs on $50bn worth of American goods.
Haibin Zhu, JP Morgan's chief China economist, said the tariffs may have a modest economic impact, but could led to the loss of as many as 700,000 jobs in China's export sector.
"The sooner President Xi and President Trump meet to craft a new trade path forward, the better", he said.
Trump administration is seeking systemic changes from China which Beijing has failed to do.
"Tariffs are a tax on American families, period", said Hun Quach, vice president for worldwide trade from the Retail Industry Leaders Association (RILA).
Before the latest announcement, 20% of total tonnage and trade value of the Los Angeles port was exposed to the tariffs and retaliatory charges.
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"It will be a lot of money coming into the coffers of the United States of America", the president said at a Monday White House event, before officially announcing the additional tariffs.
The trade actions against China will not work as China has ample fiscal and monetary policy tools to cope with the impact, a senior securities market official said earlier on Tuesday.
Officials said they wanted to shield consumer goods from the taxes as much as possible.
"The downward spiral that we have previously warned about now seems certain to materialize", said the chamber chairman, William Zarit, in a statement.
Trump made the accusations in a pair of Twitter posts as the two sides launched new trade tariffs + in an escalating trade dispute.
This will cut demand for these products (hurting the Chinese economy), and also probably drive up prices in United States shops (hurting Americans).
"Our concern with these tariffs is that the USA will be hardest hit, and that will result in lower U.S. growth and competitiveness and higher prices for United States consumers", Apple said in a letter commenting on the proposal.
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