Published: Sat, August 04, 2018
Money | By Bruce West

White House proposed increasing tariffs on $200B in Chinese imports

White House proposed increasing tariffs on $200B in Chinese imports

U.S. President Donald Trump on Wednesday instructed his trade officials to look at increasing tariffs to 25 percent from 10 percent on $200 billion in Chinese imports into the United States. "Importers may have ordered aggressively in June ahead of tariffs imposed this month by the US and China", the port stated in a press release.

"Pressure and blackmail from the USA won't work", Geng Shuang, a spokesman for the Chinese Foreign Ministry, said at a briefing in Beijing, the New York Times reported.

The drop in the PMI, a key indicator of manufacturing health in the world's second-largest economy, came as Trump's administration proposed a 25 percent tariff on another $200 billion in Chinese goods, up from an earlier 10 percent plan.

Lighthizer told reporters on Wednesday that the additional tariffs are necessary because the original duties did not prompt China to change its trade policy.

He gave no details of possible measures but said, "we are determined to safeguard our legitimate and lawful rights and interests". However, the Chinese bourses fall under the pressure on the news that Trump is considering 25% tariffs on Chinese goods worth $200 billion against 10% that are being discussed now.

Experience shows that President Trump does not always follow through on everything he says or tweets.

Trump's trade fights, including the battle with China, are starting to seep into the U.S. economy based on recent data. Trump and other NAFTA critics say the agreement encouraged US manufacturers to move factories - and jobs - south of the border to take advantage of lower-wage Mexican labor.

"This won't work on China", Geng said, adding that the Trump administration should "not blindly let emotions affect their decisions, because in the end this will harm themselves". The European Commission separately is considering a draft proposal to address some of the Trump administration's concerns and offer ways to fill gaps in WTO's 23-year-old rule book.

"The bottom line is the president's going to continue to hold China responsible for their unfair trade practices", said White House press secretary Sarah Huckabee Sanders.

USA trade representatives are trying to re-engage China in trade talks to de-escalate tensions between the two countries. The Asian economic giant has shown no signs of backing down from Trump's threats, and is said to be considering other types of retaliation, such as tougher inspections on American imports and delaying licensing and approvals for mergers. The list, unveiled on July 10, hits American consumers harder than previous rounds, with targeted goods ranging from Chinese tilapia fish and dog food to furniture, lighting products, printed circuit boards and building materials. Because of the proposed increased rate, USTR will extend the comment period to September 5.

Meanwhile, in corporate America, it appears that there is just one thing executives are talking about: tariffs.

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