Trump Announces $50 Billion In New Tariffs on 1,102 Chinese Products

President Donald Trump on Friday morning made good on his promises that he wanted to have a trade war with China.  In a statement the president said he was going to impose new tariffs on 1,102 Chinese products and they estimated the amount of the tariffs would be about $50 billion.

“My great friendship with President Xi of China and our country’s relationship with China are both very important to me. Trade between our nations, however, has been very unfair, for a very long time. This situation is no longer sustainable,” Trump said his his statement.

The list of 1,102 products that will be hit by a new 25 percent tariff was released to the press by U.S. Trade Representative Robert Lighthizer.

The timing of the announcement by Trump is very interesting since it comes just after he returned from the Singapore summit with North Korean leader Kim Jong Un.  It was widely thought that the summit was approved by China and Trump was was in China’s good graces.

The new tariff announcement, however, will increase trade tensions with Beijing and might even threaten what has been called a “cooperative partnership to help denuclearize the Korean peninsula.”

Lighthizer said the list “focuses on products from industrial sectors that contribute to or benefit from the Made in China 2025 industrial policy, which include industries such as aerospace, information and communications technology, robotics, industrial machinery, new materials and automobiles.”

The list does not, however, include popular consumer goods purchased by people in the United States, such as cellphones or televisions, Lighthizer said.

The tariffs on the first 818 products will go into effect on July 6, according to the U.S. Trade Office. A second group of tariffs on the remaining 284 products will be implemented later and in the interim will be the subject of “further review.”

“This includes goods related to China’s Made in China 2025 strategic plan to dominate the emerging high-technology industries that will drive future economic growth for China, but hurt economic growth for the United States and many other countries,” the president said in his statement.

Trump also said that the United States will impose more tariffs in the future if China retaliates by “imposing new tariffs on United States goods, services or agricultural products; raising non-tariff barriers; or taking punitive actions against American exporters or American companies operating in China.”

Government officials from China have said they would impose their own tariffs on U.S. products if Trump imposed steep tariffs on Chinese goods.

“We must take strong defensive actions to protect America’s leadership in technology and innovation against the unprecedented threat posed by China’s theft of our intellectual property, the forced transfer of American technology, and its cyber attacks on our computer networks,” Lighthizer said.

The “defensive actions” to be taken by Trump, however, were immediately criticized by major business groups throughout the U.S. 

Thomas Donohue, President and CEO of the U.S. Chamber of Commerce said that “imposing tariffs places the cost of China’s unfair trade practices squarely on the shoulders of American consumers, manufacturers, farmers and ranchers. This is not the right approach.”

Dean Garfield, president and CEO of the Information Technology Industry Council (ITI) said “tariffs are the wrong answer to China’s ongoing discriminatory and damaging trade practices.”

“We urge President Trump to reassess the approach, engage in real negotiations with China and work with allies to change Chinese policies,” Garfield said.

Republican lawmakers in Congress also expressed their concerns about the White House’s tariff plans. Republicans have historically been in favor of free trade, but in today’s environment most of them are afraid to contradict the president for fear of a backlash from his supporters.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) said:

“My message has been consistent: we need to hit our target, which is China and its deceptive and harmful trading practices. But I am concerned that these new tariffs will instead hurt American manufacturers, farmers, workers and consumers.” 

Ironically, many Democrats have been in favor of tariffs to fight back against China, so they find themselves in the position of supporting the president’s latest move.

Senate Minority Leader Chuck Schumer said, “China is our real trade enemy, and their theft of intellectual property and their refusal to let our companies compete fairly threatens millions of future American jobs.”