Tuesday, 11 December, 2018

Trump approves plan to impose punishing tariffs on Chinese goods

Trump approves plan to impose punishing tariffs on Chinese goods Trump approves plan to impose punishing tariffs on Chinese goods
Nellie Chapman | 15 June, 2018, 14:52

President Donald Trump has approved tariffs on Chinese goods worth about USD$50 billion (RM199 billion), said a person familiar with the decision, ratcheting up a confrontation on trade that's set to prompt retaliation from Beijing.

"If the United States takes unilateral, protectionist measures, harming China's interests, we will quickly react and take necessary steps to resolutely protect our fair, legitimate rights", Chinese Foreign Ministry spokesman Geng Shuang told a regular daily news briefing.

The Washington Post and The Wall Street Journal were among the publications reporting overnight that Trump, fresh from his return from the Singapore Summit with North Korean leader Kim Jong Un, has chose to enact significant tariffs on Chinese goods.

The US, China, South Korea and Japan agree that sanctions imposed on North Korea will not be lifted until it can show complete disarmament, US Secretary of State Mike Pompeo said yesterday, pushing back against North Korean suggestions that penalties would soon start being relaxed.

Although Pompeo was in Beijing to debrief the Chinese on the Singapore summit, the trade friction was never far from the surface.

Chinese State Councilor and Foreign Minister Wang Yi held talks with Pompeo on Thursday.

"The first choice is cooperation and mutual benefit".

The president has been under pressure from USA lawmakers over his decision to soften a penalty on Chinese telecom-equipment maker ZTE Corp. Several industry lobbyists said they expect the move to come as early as Friday, with the publication of a Federal Register notice, or it could be put off until next week.

"I think the tariffs are coming", said Stephen Moore, a former Trump campaign adviser and visiting fellow at The Heritage Foundation. The White House has said the duties will be implemented "shortly" after the release of Friday's list, though no date has been set.

"Implementation of the tariffs, when it occurs, could take us closer to a trade war", said Shane Oliver, head of investment strategy at AMP Capital Investors Ltd.in Sydney.

Trump no longer believes that Beijing's influence over North Korea is a compelling reason to ease up on trade talks now that his administration has opened up a direct line of communication with the nuclear-armed country, the first administration official said.

She said a trade war would lead to "losers on both sides" and could have a "serious" impact.

The US's initial list of Chinese goods to impose tariffs against included a wide array of products such as raw materials, construction machinery, agricultural equipment, electronics, medical devices, and consumer goods.

"Until recently, the resilience of growth in China was an important buffer for the global economy in the face of headwinds from trade friction, slower growth in Europe, higher oil prices and issues in various emerging markets".

Trump told Fox News in an interview aired on Wednesday that he was "very strongly clamping down on trade" with China.

"You will see over the next couple of weeks".

President Donald Trump speaks during a graduation and commissioning ceremony at the U.S. Naval Academy on May 25, 2018, in Annapolis, Maryland. "They understand what we are doing".

But if the president follows through on all the duties he's threatened, including the tariffs against China, U.S. inflation could accelerate by 15 basis points, according to Goldman Sachs.

On Thursday, a Commerce Ministry spokesman said some Chinese exporters are rushing to fill orders due to concern about possible trade risks.