United States considers hiking China tariffs to 25 percent

United States considers hiking China tariffs to 25 percent

The United States may jack up the tariff rate on the next US$200 billion in Chinese imports it plans to target as it pressures Beijing to reform its trade practices, USA officials said Wednesday.

The proposal would increase the potential tariff rate from the 10 per cent that the administration had initially put forward on July 10 for that wave of duties in a bid to pressure Beijing into making trade concessions, a source familiar with the plan said on Tuesday.

But the two neighbors - and other US allies and trading partners - have slapped back with tariffs of their own, often aimed at USA farmers who supported Trump in the 2016 election.

One person familiar with the internal deliberations said the U.S.is trying to secure certain concessions and if China agrees, it is possible the US would back off additional tariffs.

NAFTA did away with most barriers, including tariffs, on trade between the U.S., Canada and Mexico.

If the United States takes further steps to hinder trade, Beijing will retaliate, Foreign Ministry spokesman Geng Shuang has told a daily news briefing.

U.S. President Donald Trump walks from Marine One as he returns from Kansas City, Missouri, to the White House in Washington, July 24, 2018.

The Trump administration is proposing raising tariffs on $200 billion of Chinese imports to 25% from an originally planned 10%.

U.S. Trade Representative Robert Lighthizer said Trump directed the increase from a previously proposed 10 percent duty because China has refused to meet U.S. demands and has imposed retaliatory tariffs on U.S. goods.

The higher tariffs, which would apply to some $200 billion in Chinese imports identified by the administration last month, represent an effort to get Beijing to address longstanding unfair trade practices, official say.

Increasing the pressure on China by threatening even higher tariffs could backfire.

Washington is expected to soon implement more tariffs on $21 billion in additional Chinese goods, which China has already announced it will match immediately.

Canada's absence from this week's talks raised suspicions that the United States was pursuing a divide-and-conquer strategy with its two trading partners, isolating Canada to pressure it into agreeing with whatever the US and Mexico came up with.

This next wave of tariffs was originally announced in July, after China hit the United States with countermeasures in response to Trump's initial wave of tariffs.

"China has illegally retaliated against U.S. workers, farmers, ranchers and businesses". "Unilateral threats and pressure will only be counter productive".

"This won't work on China", Geng said.

"First, we advise the United States side to correct its attitude and not to try to engage in blackmail", China's foreign ministry spokesperson Geng Shuang said on Thursday.

The US government is now discussing and taking comments on the implications of these tariffs from key industry figures who are campaigning for the tariffs to be dropped or removed altogether until the 17th of August.

"It's very hard to see how this doesn't negatively impact all Americans in every walk of life", FDRA president and CEO Matt Priest previously told FN. The goods in the amount of $200 bln represent nearly the half of US imports from China and about 10% of total USA imports per year.

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