The Trump administration is preparing to impose at least $50 billion worth of tariffs on Chinese imports, in a major escalation of the president’s “America First” trade policy.
President Donald Trump initiated actions against China on Thursday that included proposed tariffs, a case at the World Trade Organization, and an investigation into Chinese investments in the United States – measures that heightened concerns about possible global trade wars.
He signed a presidential memorandum directing his trade representative to draw up a long list of Chinese products to which the tariffs would be applied. The list will be made public in 15 days, and the tariffs would take effect after a period of public comment.
This is his strongest trade action yet against China which he has called an “economic enemy,” fulfilling one of his core campaign pledges. The measure comes as the US granted exemptions to its allies from 25% steel and 10% aluminum tariffs that go into effect on Friday.
The Alliance for American Manufacturing hailed the President’s move, saying for years China has “forced technology transfer, discriminatory licensing restrictions, state-coordinated technology acquisition, and cyber-theft.”
“There’s no disagreement that China cheats. The only question is, do we continue to ignore China’s cheating or do we finally act decisively to stop it?” said AAM President Scott Paul.
“Companies that have benefited from shipping jobs to China are screaming the loudest,” he said. “We shouldn’t listen to any of these bogus complaints against tariffs. If China doesn’t play by the rules, it should lose some access to the U.S. market, which it values the most.”
“We have a large trade deficit in advanced technology products and an enormous goods trade deficit with China. We’ve lost millions of good jobs to China,” Paul said.
The United States had a $337 billion trade deficit with China last year, 9 percent larger than the year before.
The proposed tariffs on imports from China follow the administration’s decision to impose tariffs on imported steel and aluminum. Those tariffs, which take effect on Friday, have already been watered down. In addition to Canada and Mexico, Australia, Argentina, Brazil, South Korea and the European Union will be exempted from the tariffs, at least temporarily, according to officials.
Meanwhile, Wall Street concerns about possible trade wars resulted in the Dow dropping more than 500 points, or 2%, on Thursday, before trimming its losses a bit. The S&P 500 and Nasdaq too were down more than 1% each in midday trading.