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USTR Announces Latest Increase of Section 301 China Tariffs

Posted August 26, 2019

Following some Twitter pronouncements by President Trump last Friday, the Office of the U.S. Trade Representative issued a statement that in response to China’s “unjustified tariffs targeting U.S. products” — Beijing had earlier announced that it would be imposing retaliatory tariffs on $75 million worth of U.S. exports — it had been instructed by the White House “to increase by 5% the tariffs on approximately $550 billion worth of Chinese imports.”

USTR indicates that for the 25% tariffs on approximately $250 billion worth of Chinese imports, it will begin the process of increasing the tariff rate to 30%, effective October 1 following a notice and comment period. For the 10% tariffs on approximately $300 billion worth of Chinese imports announced earlier this month, the USTR states that tariffs will now be 15%, effective on the already scheduled dates for tariff increases on these imports.

As for the increasingly bitter and potentially destabilizing trade war with China, Trump continued to ramp up tensions at the G7 summit in France yesterday, telling reporters that he had “no plans right now” to follow through on his emergency declaration threat that would compel U.S. companies to leave China but added, “If I want, I could declare a national emergency.”

In an interview with CNN, White House chief economic adviser Larry Kudlow said President Trump misunderstood a question at the G7 summit where he appeared to say he had second thoughts about the China tariffs. Kudlow said Trump was never backing down on tariffs and, in fact, considered even higher tariffs.

Meanwhile, railing against what it calls Trump’s “barbaric” tariffs, China has vowed to continue fighting the trade war “until the end.” Despite that implacable official reaction, President Xi Jinping’s top economic adviser Liu He reportedly struck a far more conciliatory tone the opening today of the Smart China Expo in Chongqing where he opposed the heightening of tensions and called for a “calm attitude” to prevail in the negotiations.

“We believe that the escalation of the trade war is not beneficial for China, the United States, nor to the interests of the people of the world,” the Vice Premier said.

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