New Tariffs on Chinese Products Go into Effect

May 10 10:55 2019

President Donald Trump, in an extensive series of tweets, said early Friday that that there “is absolutely no need to rush” in talks with China, which are continuing in a “very congenial manner“.

A final agreement was expected soon, at least until the US side accused the Chinese of backtracking on commitments – angering Trump, who issued a Twitter threat to raise tariffs by the end of this week.

US and Chinese officials are to resume negotiations on Friday morning for a second day as the world’s two largest economies seek an agreement.

The tariffs could cost an average US family of four $767 a year, a study from Trade Partnership, an global trade consulting firm, estimated.

“We’re at the point where all the companies that have spoken previously to me, they just can’t put off firing people anymore”, said Baughman. Earlier, Liu said he hoped “to engage in rational and candid exchanges with the USA side” on the subject, adding that raising tariffs was not a solution.

Though talks are set to resume Friday, some close observers said they were not hopeful for any meaningful breakthroughs. And he has renewed his threat to extend the tough tariffs to all products the U.S. imports from China. He appealed to Washington to avoid more tariff hikes, saying they are “not a solution” and would harm the world.

Chinese officials have said they will retaliate with higher tariffs on US goods. The Tariffs paid to the United States of America have had little impact on product cost, mostly borne by China.

If the two sides fail to reach an agreement, Trump will come closer to decoupling the USA and Chinese economies – which he claims will bring blue-collar manufacturing jobs back to the United States.

Trump said last night he received a letter from the Chinese President Xi Jinping.

In a separate note, global rating agency Fitch said a 25 per cent tariff rate would impose a cost of United States dollars 72 billion, or 0.5 per cent of China’s GDP, which could imply a cut to growth forecasts in absence of a much more aggressive domestic policy response.

China on Friday also threatened to take measures in response to the latest additional tariffs imposed by Trump but gave no other details.

Imposing new tariffs on China as President Donald Trump has suggested would hurt US businesses and keep companies like Ohio’s Cleveland Whiskey from exporting their products to other countries and hiring more workers, business groups fighting the tariffs told reporters on Thursday.

If tariff hikes go ahead, “risks of a financial market collapse, extreme risk aversion, and sharp slowdown in global growth will spike”, said Philip Wee of DBS Group in a report. Washington has confirmed the trade talks will continue despite the flare-up in the trade war.

While China’s overall economic growth has this year remained steady, the outlook for exporters has been challenging. Trump tweeted early Friday.

The Commerce Ministry said that negotiations were continuing, and that it “hopes the United States can meet China halfway, make joint efforts, and resolve the issue through cooperation and consultation”.

But due to a quirk in the implementation of the higher tariffs, products already on ships headed for US ports before midnight will only pay the prior 10 percent duty rate, US Customs and Border Protection explained. Liu He, Chinese vice premier, is leading the talks with Robert Lighthizer, the USTR.

“We would like to raise prices immediately”, he said, but Kent’s major retail partners have policies that prevent that. China wants them lifted; the US wants to keep tariffs as leverage to pressure the Chinese to comply with any agreement.

Trade war: Trump says China 'broke the deal' in trade talks

New Tariffs on Chinese Products Go into Effect
 
 
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