Trump's administration announced that they will place an additional $16 million tariffs on China starting August 23, according to the US Trade Representative's office. The new tariff list targeted 279 import product lines. Only five were deleted from the initial list proposed on June 15. USTR removed those items because they deemed that taxing them would cause "severe economic harm." China has stated that they will counter Washington's move and impose tariffs of their own of an equivalent amount.
The products included intermodal shipping containers, floating docks, splitting and slicing machines used with wood, bone and hard plastics, microtomes, alginic acid, which is used in pharmaceuticals, textile printing, and dental impressions. This new list adds up to $50 billion total in taxed goods that now face a 25% tariff. The 25% trade tariffs will also apply to Chinese electronics, plastics, chemicals and railway equipment, which the US Trade Representative has said will benefit from China's "Made in China 2025" industrial plan.
President Trump has also threatened to impose tariffs on additional $200 billion worth of Chinese goods and maybe even another $300 billion worth. The Semiconductor Industry Association has expressed their disappointment at the administration's decision to keep semiconductors on the list, as they are crucial to technological development. In a statement, SIA President John Neuffer said, "We have made the case to the administration, in the strongest possible terms, that tariffs imposed on semiconductors imported from China will hurt America's chipmakers, not China's, and will do nothing to stop China's problematic and discriminatory trade practices." A trade war between US and China is estimated to reduce global output by .7% by 2020, with China's economy seeing a 1.3% drop and US GDP falling by 1%. China's trade surplus is currently at $28.1, close to record high. President Trump has stated on several occasions that although this move might hurt some industries in the short term, the US will reap long-term benefits as it forces China to negotiate. But how far will the administration have to go?
- https://www.reuters.com/article/us-usa-trade-china/u-s-finalizes-next-china-tariff-list-targeting-16-billion-in-imports-idUSKBN1KS2CB
- https://www.bloomberg.com/news/articles/2018-08-07/u-s-finalizes-tariffs-on-16-billion-of-chinese-goods
- https://www.cnbc.com/2018/08/07/us-finalizes-next-china-tariff-list-targeting-16-billion-in-imports.html