United States Increases Tariffs on More Chinese Products

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The U.S. Trade Representative (USTR) has published the official Federal Register notice increasing tariffs from 10% to 25% on another $200 billion worth of Chinese products, effective at 12:01 a.m. on Friday.

Meanwhile, the USTR also has added more products to the list of exclusions from the first round of tariffs. The list includes numerous codes for items used in manufacturing, including spools of aluminum and steel and coils; push-button switches; DC electric motors and AC electric motors.

U.S. and Chinese officials have met regularly since January to resolve long-standing trade issues with the goal of de-escalating trade tensions and easing the tit-for-tat tariff increases that took effect last year.

Officials from both countries have reported progress in negotiations over the past few months, but the U.S. posture changed abruptly last week. U.S. officials, according to news reports, felt that Chinese officials had “backtracked” on key commitments, including IP and technology transfer reforms. In response, President Trump personally decided to increase tariffs this week.

Meetings between senior U.S. and Chinese trade officials are scheduled to resume today. We are unlikely to see an agreement this week, as had been the goal.

President Trump has suggested that he may also impose new or increased tariffs on all Chinese products imported into the U.S., but a decision that bold would hinge on the President’s estimation of whether a deal can get done and what pressure is necessary to strike it.

The Chinese have promised retaliatory tariffs.