Trump to raise tariffs on imports from China as Beijing backpedals in talks, and China continues to meet

President Donald Trump heightened tensions in the U.S.-China trade war by vowing Sunday on Twitter to impose a 25 percent tariff on essentially all Chinese goods. On Friday, May 10, a 10% tariff on roughly $200 billion worth of Chinese goods will increase to 25%,  USTR Lighthizer said. In addition, a 25% tariff on all the rest of what the U.S. imports from China — about $325 billion in products — could also be imposed after a rule-making and comment period, which typically takes several months. Senate Democratic Leader tells Trump to “hang tough” with China.

Trump also said he would “shortly” be imposing a 25 percent duty on another $325 billion worth of Chinese goods.

 

Despite the promise to increase tariffs by the end of the week, the U.S. is not breaking off talks at this point, and a delegation of Chinese officials led by Vice Premier Liu He is still expected to travel to Washington this week.

Treasury Secretary Steven Mnuchin said administration officials are “completely unified” on the decision to hit back with more duties.

“We are not willing to go back on documents that had been negotiated and in our minds agreed to,” he said in the same briefing. Neither Mnuchin nor Lighthizer specified which commitments China had backtracked on

Lighthizer returned from China last week angered by the Chinese government’s attempts to reopen aspects of the deal the U.S. had considered settled.

“Over the course of the last week or so, we have seen an erosion in commitments by China. I would say retreating from specific commitments that had already been made,” Lighthizer told reporters in Washington. “That, in our view, is unacceptable.”

The Chinese sought to make “substantial” changes in the agreed text of a voluminous, seven-chapter pact, he said, adding, “Really, I would use the word ‘reneging’ on prior commitments.”

Lighthizer and Mnuchin didn’t foreclose the chance for a deal.

“If we can get the kind of deal that makes substantial structural changes the president would like that kind of deal, but that’s just not where we are right now,” Lighthizer said.

Lighthizer shared his frustrations with Trump, who this weekend issued tweets that marked a sharp change in tone since late April, when he was outwardly optimistic about reaching a deal. He had even told reporters he could “soon” be hosting Chinese President Xi Jinping at the White House.

The Chinese team is set to come to Washington on Thursday and Friday, according to Lighthizer. Talks continue, and the two sides are not cutting off discussions after President Donald Trump threatened to increase tariffs already placed on Chinese products and add new duties, the trade official said. China’s Commerce Ministry confirmed Tuesday that Liu will visit the U.S. on May 9 and May 10, according to Reuters.

Senate Minority Leader Chuck Schumer tells President Donald Trump to “hang tough” after the president threatens more tariffs on Chinese goods.

Michael Pillsbury said, “We’re moving toward a 10-year framework in which there will be an appeals system, an enforcement mechanism that doesn’t exist now other than the WTO.”  “The level of mutual understanding will be much higher from each of the two leaders on what each side expects from the trade relationship.”

Sources:

https://www.politico.com/story/2019/05/06/stock-market-trump-china-tariff-threats-1412031

https://www.cnbc.com/2019/05/06/chinas-liu-he-will-join-us-china-trade-talks-after-trump-tariff-threat.html

https://www.cnbc.com/2019/05/06/schumer-urges-trump-to-hang-tough-after-china-trade-tariff-threat.html?recirc=taboolainternal

https://www.washingtonpost.com/business/economy/trump-administration-accuses-chinese-officials-of-reneging-on-earlier-commitments-in-trade-talks/2019/05/06/808e91f4-7037-11e9-8be0-ca575670e91c_story.html?utm_term=.db7b3f016dbe

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